SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
November 6, 1999
Date of Report (Date of earliest event reported)
SCOOP, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-22281 33-0726608
(State or other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
Cyberia House
Church Street, Basingstoke
Hampshire RG21 7QN
United Kingdom
(Address of Principal Executive Offices)
(Zip Code)
+44 1256 867 800
(Registrant's telephone number, including area code)
1800 Century Park East, Suite 600
Los Angeles, California 90067
(Former name or former address, if changed since last report)
<PAGE>
TABLE OF CONTENTS
Page
Item 1 Changes in Control of Registrant 3
Item 2 Acquisition or Disposition of Assets 3
Item 3 Bankruptcy or Receivership 3
Item 4 Changes in Registrant's Certifying Accountant 3
Item 7(a) Financial Statements 3
Item 7(b) Pro Forma Financial Information 3
Item 7(c) Exhibits 3
Signature 4
Exhibit Index 5
<PAGE>
ITEM 1. CHANGES IN CONTROL OF REGISTRANT.
A description of the transactions resulting in a change in control of
Scoop, Inc. (the "Company") is set forth in Item 3 below, which description is
incorporated herein by this reference.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
A description of the transactions pursuant to which the Company has
acquired a significant amount of assets otherwise than in the ordinary course of
business is set forth in Item 3 below, which description is incorporated herein
by this reference.
ITEM 3. BANKRUPTCY OR RECEIVERSHIP.
As previously reported by the Company in its quarterly report on Form
10-QSB for the quarterly period ended June 30, 1998 (filed August 14, 1998),
incorporated herein by this reference, on July 31, 1998, the Company filed a
voluntary petition commencing a case under Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the Central District
of California (the "Bankruptcy Court") as Case No. SA 98-20799 RA. On April 23,
1999, the Company entered into a Stock Purchase Agreement, attached hereto as
Exhibit 2.2 (the "Stock Purchase Agreement"), with InfiniCom AB (publ), a
company organized and existing under the laws of the Kingdom of Sweden
("InfiniCom"), pursuant to which InfiniCom agreed to acquire such number of
newly issued shares of Common Stock which in the aggregate would represent
approximately 91% of the issued and outstanding Common Stock on a fully diluted
basis (the "Acquired Shares") in exchange for 100% of the issued and outstanding
ordinary shares of 10 pence each (the "24STORE Stock") of 24STORE.com Limited, a
company incorporated under the laws of England and Wales ("24STORE"). As
additional consideration for InfiniCom's acquisition of the Acquired Shares (the
"Acquisition"), and as an incentive for the creditors of the Company to approve
and support the foregoing transaction as a part of the bankruptcy process,
InfiniCom paid the sum of $225,000, plus interest thereon, to the Company to be
used for payment to holders of all allowed general unsecured claims to the
extent that the bankruptcy estate of the Company was insufficient to pay in full
the allowed amount. Under the terms of the Stock Purchase Agreement, InfiniCom
agreed to pay an additional sum of up to $125,000 to the Company to reimburse
the Company for certain transaction costs associated with the negotiation,
documentation and consummation of the Acquisition.
On July 23, 1999, the Company filed its Second Amended Plan of
Reorganization (the "Plan") and a related Second Amended Disclosure Statement
(the "Disclosure Statement") with the Bankruptcy Court. The Plan contemplated
that upon its confirmation the Acquisition would be consummated and the
Disclosure Statement contained material information concerning InfiniCom and
24STORE. By an order dated August 5, 1999, the Bankruptcy Court approved the
Disclosure Statement as containing adequate information and the Disclosure
Statement and the Plan were then distributed to the Company's creditors and
shareholders for approval, which was subsequently obtained. As previously
announced by the Company in a press release dated October 1, 1999, attached
hereto as Exhibit 99.1 and incorporated herein by this reference, on September
30, 1999 the Plan was confirmed by order of the Bankruptcy Court (the
"Confirmation Order"). Pursuant to the Confirmation Order, the Bankruptcy Court
approved the Plan and the Stock Purchase Agreement on October 5, 1999. A copy of
the Plan, as confirmed by the Bankruptcy Court, is attached hereto as Exhibit
2.1 and is incorporated herein by this reference.
As of December 7, 1999, in accordance with the Plan and the Stock
Purchase Agreement, as modified by the Agreement dated as of November 1, 1999
between the Company and InfiniCom, attached hereto as Exhibit 2.3 and
incorporated herein by this reference, InfiniCom had acquired from the Company a
total of 60,783,219 shares of Common Stock in exchange for the 24STORE Stock
(the "Closing"). The aggregate amount of Common Stock acquired by InfiniCom
represents approximately 91% of the 66,795,457 shares of Common Stock issued and
outstanding immediately following the Closing. Following the Closing, InfiniCom
transferred a total of 2,231,658 shares of Common Stock to lenders in accordance
with financing arrangements previously entered into by InfiniCom in order to
raise working capital, resulting in an ownership of the Company by InfiniCom of
approximately 88%.
Financial information as to the assets and liabilities of the Company
as of September 30, 1999 is set forth in its monthly operating report for the
month ended September 30, 1999, which report was filed with the Bankruptcy
Court, is attached hereto as Exhibit 99.2 and is incorporated herein by this
reference.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
As previously reported by the Company in its Current Report on Form
8-K dated April 7, 1999 (filed May 7, 1999), incorporated herein by this
reference, on April 7, 1999, the client-auditor relationship between the Company
and Deloitte & Touche LLP ceased. Effective March 31, 2000, the Company has
engaged Stonefield Josephson, Inc. ("SJI") as its new independent accountants.
The decision to so engage SJI was recommended and approved by the Company's
Board of Directors.
ITEM 7(A). FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.
The required financial statements will be provided by amendment in
accordance with Item 7(a)(4).
ITEM 7(B). PRO FORMA FINANCIAL INFORMATION.
The required pro forma financial information will be provided by
amendment in accordance with Item 7(b)(2).
ITEM 7(C). EXHIBITS.
The information set forth in the Exhibits attached hereto is hereby
expressly incorporated herein by reference and the response to each item of this
report is qualified in its entirety by the provisions of such exhibits.
Exhibit 2.1 Second Amended Plan of Reorganization of Scoop, Inc.
Exhibit 2.2 Stock Purchase Agreement, dated as of April 23, 1999,
between InfiniCom AB (publ) and Scoop, Inc.
Exhibit 2.3 Agreement, dated as of November 1, 1999, between
InfiniCom AB (publ) and Scoop, Inc.
Exhibit 99.1 Press Release dated October 1, 1999
Exhibit 99.2 Monthly Operating Report for the Month Ended September
30, 1999
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: April 5, 2000 SCOOP, INC.
By: /s/ Larsake Sandin
----------------------------
Name: Larsake Sandin
Title: Chairman of the Board
<PAGE>
EXHIBIT INDEX
Exhibit 2.1 Second Amended Plan of Reorganization of Scoop, Inc.
Exhibit 2.2 Stock Purchase Agreement, dated as of April 23, 1999,
between InfiniCom AB (publ) and Scoop, Inc.
Exhibit 2.3 Agreement, dated as of November 1, 1999, between InfiniCom
AB (publ) and Scoop, Inc.
Exhibit 99.1 Press Release dated October 1, 1999
Exhibit 99.2 Monthly Operating Report for the Month Ended September
30, 1999
ROBERT E. OPERA - State Bar No. 101182
HAMID R. RAFATJOO - State Bar No. 181564
LOBEL, OPERA & FRIEDMAN LLP
19800 MacArthur Blvd., Suite 1100
Irvine, CA 92612-2425
Telephone: (949) 476-7400
Facsimile: (949) 476-7444
Attorneys for Scoop, Inc.
Debtor and Debtor-in-Possession
UNITED STATES BANKRUPTCY COURT
CENTRAL DISTRICT OF CALIFORNIA
SANTA ANA DIVISION
In re Case No. SA 98-20799 RA
SCOOP, INC., a Delaware corporation; Chapter 11 Case
fka Karlsson-Del Rey Communications, Inc.,
and NewsMakers Information Services, Inc., SECOND AMENDED PLAN
OF REORGANIZATION
Debtor and (JULY 23, 1999)
Debtor-in-Possession.
DATE: September 30, 1999
TIME: 3:30 p.m.
PLACE: Courtroom 6C
411 W. Fourth Street
Santa Ana, CA 92701
<PAGE>
TABLE OF CONTENTS
I. INTRODUCTION...........................................................1
II. DEFINITIONS............................................................2
III. TREATMENT OF UNCLASSIFIED CLAIMS......................................10
IV. DESIGNATION OF CLASSES OF CLAIMS AND INTERESTS........................11
V. TREATMENT OF CLASS UNIMPAIRED BY THE PLAN.............................11
VI. TREATMENT OF IMPAIRED CLASSES OF CLAIMS...............................11
VII. EXECUTION AND IMPLEMENTATION OF THE PLAN..............................13
VIII. DISBURSING AGENT......................................................28
IX. REQUEST FOR FINDINGS OF FAIR AND EQUITABLE
TREATMENT OF IMPAIRED CLASSES.........................................32
X. CONDITIONS PRECEDENT TO DISTRIBUTIONS UNDER THE PLAN..................32
XI. MODIFICATION OF PLAN..................................................33
XII. TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES.................34
XIII. EFFECT OF CONFIRMATION................................................35
XIV. RETENTION OF JURISDICTION.............................................37
XV. DESIGNATION OF THE COMMITTEE AS REPRESENTATIVE
OF THE ESTATE.........................................................39
XVI. PROVISIONS OF THE PLAN WHICH MAY AFFECT, ALTER, OR
MODIFY THE RIGHTS OF CREDITORS........................................39
XVII. RESERVATION OF RIGHTS.................................................40
XVIII.MISCELLANEOUS PROVISIONS..............................................40
XIX. REQUEST FOR CONFIRMATION..............................................43
<PAGE>
Scoop, Inc., a Delaware corporation, the Debtor in this Case(F1) hereby
proposes the following Plan for the resolution of outstanding Claims against and
Interests in the Debtor, and requests Confirmation of this Plan pursuant to
Section 1129 of the Bankruptcy Code.
(F1) The definitions of the capitalized terms used herein are contained in
Article II of this Plan.
I.
INTRODUCTION
This Plan is proposed by the Debtor for the resolution of the outstanding
Claims against its Estate. Reference should be made to the Disclosure Statement
provided herewith for a detailed disclosure of the business, assets and
liabilities, and financial affairs of the Debtor, and an analysis of this Plan.
UNLESS SPECIFICALLY SET FORTH TO THE CONTRARY IN THIS PLAN, THE INFORMATION
CONTAINED OR REFERRED TO IN THIS PLAN HAS NOT BEEN SUBJECT TO CERTIFIED AUDIT.
RECORDS KEPT BY THE DEBTOR RELY FOR THEIR ACCURACY ON BOOKKEEPING PERFORMED
INTERNALLY BY THE DEBTOR. ALTHOUGH THE DEBTOR BELIEVES THAT EVERY REASONABLE
EFFORT HAS BEEN MADE TO PRESENT ACCURATE FINANCIAL INFORMATION, THE RECORDS KEPT
BY THE DEBTOR ARE NEITHER WARRANTED NOR REPRESENTED TO BE FREE OF INACCURACY.
THE DEBTOR'S COUNSEL, ACCOUNTANTS, AND FINANCIAL CONSULTANTS HAVE NOT
INDEPENDENTLY VERIFIED THE INFORMATION CONTAINED HEREIN, AND MAKE NO
REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ACCURACY THEREOF.
ANY PARTY ENTITLED TO VOTE ON THIS PLAN IS URGED TO REVIEW CAREFULLY THIS
PLAN PRIOR TO VOTING ON THIS PLAN, AND MAY DESIRE TO CONSULT WITH HIS OWN LEGAL
COUNSEL PRIOR TO VOTING ON THIS PLAN TO ENSURE COMPLETE UNDERSTANDING OF THE
TERMS OF THIS PLAN.
II.
DEFINITIONS
2.01 "Administrative Claim" means a Claim for costs and expenses of the
administration of the Case under Sections 503(b) or 507(b) of the Bankruptcy
Code, including, without limitation, (a) the actual and necessary costs and
expenses incurred after the Petition Date of preserving the Estate and operating
the business of the Debtor (such as wages, salaries, or commissions for
services), (b) all Claims of professionals employed at the expense of the
Estate, and (c) any fees or charges assessed against the Estate under 28 U.S.C.
ss. 1930.
2.02 "Allowed Administrative Claim" means an Administrative Claim allowed
pursuant to Sections 503(b) or 507(b) of the Bankruptcy Code.
2.03 "Allowed Claim" means a Claim that is either (i) listed in the
Schedules filed with the Bankruptcy Court by the Debtor and not listed as
disputed, contingent or unliquidated as to amount and as to which no objection
is filed within the time period fixed by the Bankruptcy Court, or as to which
any such objection has been determined by a Final Order, or (ii) with respect to
which a Proof of Claim has been filed within the time period fixed by the
Bankruptcy Court, and as to which no objection is filed within the time period
fixed by the Bankruptcy Court, or as to which any such objection has been
determined by a Final Order.
2.04 "Allowed General Unsecured Claim" means an unsecured Allowed Claim
against the Debtor, however arising, not entitled to priority under Section
507(a) of the Bankruptcy Code, including, without limitation, an Allowed Claim
based on the rejection of an executory contract or unexpired lease.
2.05 "Allowed Priority Claim" shall have the meaning provided for in
Paragraph 7.03 of this Plan.
2.06 "Allowed Priority Tax Claim" means an Allowed Claim entitled to
priority pursuant to Section 507(a)(8) of the Bankruptcy Code.
2.07 "Allowed Priority Unsecured Claim" means an Allowed Claim entitled to
priority pursuant to Sections 507(a)(3), 507(a)(4), or 507(a)(6) of the
Bankruptcy Code.
2.08 "Avoidance Action" means any action which is filed or which may be
filed pursuant to the provisions of Sections 510, 542, 543, 544, 545, 547, 548,
549, or 550 of the Bankruptcy Code, any actions based on applicable
nonbankruptcy law that may be incorporated or brought under the foregoing
sections of the Bankruptcy Code, or any other similar action or proceeding filed
to recover property for or on behalf of the Estate or to avoid a lien or
transfer.
2.09 "Bankruptcy Code" means Title 11 of the United States Code, as now in
effect or hereafter amended. All citations in this Plan to section numbers are
to the Bankruptcy Code unless otherwise expressly indicated.
2.10 "Bankruptcy Court" means the United States Bankruptcy Court for the
Central District of California which has jurisdiction over the Case and the
Estate of the Debtor, or such successor court or tribunal as may hereafter be
confirmed or created by lawful authority with power to confirm reorganization
plans under Chapter 11 of the Bankruptcy Code and all applicable statutes,
rules, and regulations pertaining thereto.
2.11 "Bankruptcy Rules" means the Federal Rules of Bankruptcy Procedure and
the Local Bankruptcy Rules for use in the Bankruptcy Court, as now in effect or
hereafter amended.
2.12 "Bar Date" means the last date for filing Proofs of Claim other than
Administrative Claims or Claims based upon the rejection of any executory
contracts or unexpired leases. The Bankruptcy Court established November 18,
1998 as the Bar Date in the Case with respect to the following Creditors and
Equity Security Holders:
a) Creditors and Equity Security Holders holding Claims or Interests
which have not been properly listed, or properly classified, in the
Schedules;
b) Creditors and Equity Security Holders holding Claims or Interests
who disagree with the amount listed in the Schedules as disputed,
unmatured, contingent, or unliquidated or as to which the amount is
scheduled as unknown; and
c) Creditors and Equity Security Holders holding Claims or Interests
who disagree with the amount listed for such claims or interests in the
Schedules.
2.13 "Business Day" means any day other than a Saturday, Sunday, or "legal
holiday" (as defined in Bankruptcy Rule 9006(a)).
2.14 "Case" means the Debtor's Chapter 11 case which was filed in the Santa
Ana division of the Bankruptcy Court, as Case No. SA 98-20799 RA.
2.15 "Cash" means cash and cash equivalents, including, but not limited to,
checks or similar forms of payment or exchange.
2.16 "Claim" means (i) a right to payment from the Debtor, whether or not
such right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured, or
unsecured, or (ii) a right to an equitable remedy for breach of performance if
such breach gives rise to a right to payment from the Debtor, whether or not
such right to an equitable remedy is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
secured, or unsecured.
2.17 "Claimant" means the holder of a Claim.
2.18 "Class" means a grouping into which Claims or Interests which are
substantially similar to other Claims or Interests have been classified pursuant
to Article IV of this Plan.
2.19 "Closing Date" shall have the meaning provided in Section 3.3 of the
InfiniCom Stock Agreement.
2.20 "Committee" means the Official Committee of Creditors Holding
Unsecured Claims formed pursuant to Section 1102 of the Bankruptcy Code.
2.21 "Committee Certificate" means that certificate which will be filed by
the Committee pursuant to Paragraph 7.12 of this Plan, attesting that the
Committee has determined that all Allowed Priority Claims have been paid, all
Post-Confirmation Estate Claims and objections to Claims have been resolved by a
Final Order, and that all Retained Assets have been appropriately disposed of or
that no further action should be taken relative thereto.
2.22 "Confirmation" means the entry of the Confirmation Order by the
Bankruptcy Court.
2.23 "Confirmation Date" means the date on which the Confirmation Order is
entered by the Bankruptcy Court.
2.24 "Confirmation Hearing" means the hearing, including any continued or
postponed session thereof, at which time the Bankruptcy Court will consider and
determine whether to confirm this Plan.
2.25 "Confirmation Order" means the order, as entered, of the Bankruptcy
Court confirming this Plan pursuant to Section 1129 of the Bankruptcy Code.
2.26 "Creditor" means the holder of an Allowed Claim.
2.27 "Debtor" means Scoop, Inc., a Delaware corporation, the debtor and
debtor-in-possession in the Case, formerly known as Karlsson-Del Rey
Communications, Inc., and NewsMakers Information Services, Inc.
2.28 "Disbursing Agent" means the entity charged with making Distributions
pursuant to the terms of this Plan. Pursuant to Paragraph 8.01 of this Plan,
Bruce W. Ballenger will serve as the Disbursing Agent under this Plan.
2.29 "Disclosure Statement" means the Second Amended Disclosure Statement
(and all exhibits or schedules annexed thereto or referenced therein) which
accompanies this Plan, as the Disclosure Statement may be amended, modified, or
supplemented from time to time in accordance with the Bankruptcy Code and
Bankruptcy Rules.
2.30 "Disputed Claim" means:
a) in the event that a Proof of Claim has not been filed by the Bar
Date or has not otherwise been deemed timely filed under applicable law and
such Claim has been listed on the Schedules as disputed, contingent, or
unliquidated, then such Claim is a Disputed Claim; or
b) in the event that a Proof of Claim or request for payment of an
Administrative Claim has been filed by the Bar Date or has otherwise been
deemed timely filed under applicable law, then such Claim is a Disputed
Claim if an objection has been timely filed by the Debtor or by any other
party-in-interest and such objection has not been withdrawn or denied by a
Final Order. A Claim shall be considered a Disputed Claim in its entirety
if an objection is timely filed to any portion of such Claim.
2.31 "Disputed General Unsecured Claim" means a General Unsecured Claim
which is a Disputed Claim.
2.32 "Disputed General Unsecured Claims Reserve" means a segregated,
interest-bearing account established at a financial institution which is an
authorized depository under the United States Trustee guidelines, into which the
Disbursing Agent will deposit the Distributions to be held in reserve on account
of Disputed General Unsecured Claims pursuant to Paragraph 7.05 of this Plan.
2.33 "Disputed Priority Claim" shall have the meaning provided for in
Paragraph 7.03 of this Plan.
2.34 "Disputed Priority Claims Reserve" means a segregated,
interest-bearing account established at a financial institution which is an
authorized depository under the United States Trustee guidelines, into which the
Disbursing Agent will deposit the Distributions to be held in reserve on account
of Disputed Priority Claims pursuant to Paragraph 7.03 of this Plan.
2.35 "Distribution" means the Cash which is required to be distributed
under this Plan to the holders of Allowed Claims.
2.36 "Distribution Schedule" shall have the meaning provided for in
Paragraph 8.03 of this Plan.
2.37 "Effective Date" means the date not later than the fifth (5th)
Business Day following the date upon which the Confirmation Order becomes a
Final Order; provided, however, that, if an appeal of the Confirmation Order is
timely filed, the Debtor, with the written consent of InfiniCom, which consent
shall not be unreasonably withheld, may elect to cause this Plan to become
effective, notwithstanding the pendency of such appeal, so long as no stay of
the Confirmation Order is in effect, by filing with the Bankruptcy Court a
notice of such election, in which event this Plan will become effective as
provided herein.
2.38 "Equity Security Holder" means the holder of an Interest in the
Debtor.
2.39 "Escrow Holder" means the person or entity charged with
holding the $225,000 deposit made by InfiniCom pursuant to the InfiniCom Stock
Agreement.
2.40 "Estate" means the estate created under Section 541 of the Bankruptcy
Code in the Case.
2.41 "Final Distribution" shall have the meaning provided for in Paragraph
7.12 of this Plan.
2.42 "Final Order" means an order or judgment of the Bankruptcy Court, or
of any court of competent jurisdiction where there is pending an action in which
the Debtor is a party, which has not been reversed, stayed, modified or amended,
and as to which (a) the time to appeal, petition for certiorari, or move for
reargument or rehearing has expired and as to which no appeal, petition for
certiorari, or other proceeding for reargument or rehearing shall then be
pending, or (b) any right to appeal, petition for certiorari, reargument, or
rehearing shall have been waived in writing in form and substance satisfactory
to the Debtor, or (c) any appeal, petition for certiorari, reargument or
rehearing has been resolved by the highest court to which the order or judgment
was appealed timely or from which certiorari, reargument or rehearing was
sought.
2.43 "General Unsecured Claim" means an unsecured Claim against the Debtor
that is not entitled to priority under Section 507(a) of the Bankruptcy Code,
including, without limitation, a Claim based on the rejection of an executory
contract or unexpired lease.
2.44 "InfiniCom" means InfiniCom AB (publ), a holding company formed under
the laws of Sweden, or its assignee or nominee as provided for by the InfiniCom
Stock Agreement.
2.45 "InfiniCom Stock Agreement" means that Stock Purchase Agreement dated
April 23, 1999 entered into by and between the Debtor and InfiniCom. A true and
correct copy of the InfiniCom Stock Agreement is attached hereto as Exhibit "1"
and is incorporated herein by this reference.
2.46 "Interest" means a share of common stock in the Debtor or the
Reorganized Debtor.
2.47 "Net Litigation Proceeds" shall have the meaning provided for in
Paragraph 7.08 of this Plan.
2.48 "Petition Date" means July 31, 1998, the date on which the Debtor
filed its voluntary petition under Chapter 11 of the Bankruptcy Code, commencing
the Case.
2.49 "Plan" means the Debtor's Second Amended Plan of Reorganization, as
the Plan may be amended, modified, or supplemented from time to time in
accordance with the Bankruptcy Code and Bankruptcy Rules.
2.50 "Plan Fund" means a segregated, interest-bearing trust account
established at a financial institution which is an authorized depository under
United States Trustee guidelines, into which the Disbursing Agent will deposit
all funds of the Estate available for distribution to holders of Allowed General
Unsecured Claims under this Plan, after establishing the Reserve Fund and after
payment of or reservation for payment of all Priority Claims.
2.51 "Post-Confirmation Estate Claims" shall have the meaning provided for
in Paragraph 7.08 of this Plan.
2.52 "Priority Claims" shall have the meaning provided for in Paragraph
7.03 of this Plan.
2.53 "Priority Tax Claim" means any Claim asserted under Section 507(a)(8)
of the Bankruptcy Code.
2.54 "Priority Unsecured Claim" means a Claim asserted to have priority
under Sections 507(a)(3), 507(a)(4), or 507(a)(6) of the Bankruptcy Code.
2.55 "Proof of Claim" means a statement under oath filed in the Case by a
Claimant in which the Claimant sets forth the amount claimed to be owed to it
and sufficient detail to identify the basis for the Claim, in accordance with
Rule 3001 of the Federal Rules of Bankruptcy Procedure.
2.56 "Reserve Fund" means a segregated, interest-bearing trust account
established at a financial institution which is an authorized depository under
United States Trustee guidelines, into which the Disbursing Agent will deposit
the funds of the Estate set aside for the purpose of paying certain
post-confirmation expenses. as provided for in Paragraph 7.10 of this Plan.
2.57 "Retained Assets" shall have the meaning provided for in Paragraph
7.16 of this Plan.
2.58 "Reorganized Debtor" means the Debtor, as its financial affairs are
reorganized from and after the Effective Date.
2.59 "Schedules" means the Schedules of Assets and Liabilities and
Statement of Financial Affairs filed by the Debtor in the Case, as amended,
modified, or supplemented from time to time.
2.60 "Secured Claim" means a Claim secured by a lien, security interest or
other charge against property in which the Estate has an interest, or which is
subject to setoff under Section 553 of the Bankruptcy Code, to the extent of the
value, determined in accordance with Section 506(a) of the Bankruptcy Code, of
the interest of the holder of such Secured Claim in the Estate's interest in
such property, or to the extent of the amount subject to any setoff, as the case
may be.
2.61 "SIS Asset Sale" means the Debtor's sale and assignment to Solutions
Corporation of America, a Tennessee corporation, of substantially all of the
assets of the Debtor's Scoop Information Services division pursuant to the
provisions of that Asset Purchase Agreement, dated August 14, 1998, and that
Equipment Purchase Agreement, dated August 14, 1998. The SIS Asset Sale is
described in detail in Article V.B.2 of the Disclosure Statement.
2.62 "SMS Asset Sale" means the Debtor's sale and assignment to Call
Properties, LLC, a California limited liability company, of substantially all of
the assets of the Debtor's Scoop Media Services division pursuant to the
provisions of that Agreement of Sale, dated June 17, 1998. The SMS Asset Sale is
described in detail in Article V.B.3 of the Disclosure Statement.
2.63 "24STORE" means 24STORE.com Limited, a company incorporated under the
laws of England and Wales.
2.64 "Unclaimed Distribution" shall have the meaning provided for in
Paragraph 7.14 of this Plan.
2.65 "Unclaimed Distribution Holding Period" shall have the meaning
provided for in Paragraph 7.14 of this Plan.
2.66 "Unclaimed Distribution Reserve" shall have the meaning provided for
in Paragraph 7.14 of this Plan.
2.67 "Wage Claimant" means a Claimant asserting a Claim pursuant to Section
507(a)(3) or (a)(4) of the Bankruptcy Code.
III.
TREATMENT OF UNCLASSIFIED CLAIMS
In accordance with Section 1123(a)(1) of the Bankruptcy Code, Allowed
Administrative Claims and Allowed Priority Tax Claims have not been classified
and are excluded from classification of Claims provided for by Article IV of
this Plan. The treatment of Allowed Administrative Claims and Allowed Priority
Tax Claims is as follows:
3.01 Allowed Administrative Claims
Except to the extent that the holder of a particular Allowed Administrative
Claim agrees to a different treatment thereof, each Allowed Administrative Claim
shall be paid in full, in Cash, on the later of (i) the Effective Date, or (ii)
the fifth (5th) Business Day after the order allowing such Administrative Claim
becomes a Final Order. Any holder of an Administrative Claim (including, without
limitation, any governmental unit holding an Administrative Claim for
post-petition taxes and/or interest and penalties related to such taxes) is
required to file a request for payment of its Administrative Claim. Requests for
payment of Administrative Claims shall be filed not later than thirty (30) days
after the Effective Date, and shall be paid on the fifth (5th) Business Day
after the order allowing such Administrative Claim becomes a Final Order.
Failure to file a request for payment of its Administrative Claim within thirty
(30) days after the Effective Date shall forever bar such holder of an
Administrative Claim from asserting its Administrative Claim against the Estate.
3.02 Allowed Priority Tax Claims
Unless the Debtor and the holder of a particular Allowed Priority Tax Claim
agrees to a different treatment thereof, each Allowed Priority Tax Claim shall
be paid in full, in Cash, on the later of (i) the Effective Date, or (ii) the
fifth (5th) Business Day after the order allowing such Priority Tax Claim
becomes a Final Order. No post-petition interest shall be paid with respect to
any Allowed Priority Tax Claims; provided, however, that in the event that there
are funds remaining after the payment in full of all Allowed Claims and the
payment of interest to holders of Allowed Priority Unsecured Claims,
post-petition interest shall be paid with respect to Allowed Priority Tax Claims
at the rate of ten percent (10%) per annum in accordance with the provisions of
Paragraph 7.06 of this Plan.
IV.
DESIGNATION OF CLASSES OF CLAIMS AND INTERESTS
The following is a designation of the Classes of Claims and Interests under
this Plan. A Claim shall be deemed classified in a particular Class only to the
extent that the Claim qualifies within the description of that Class and shall
be deemed classified in another Class or Classes to the extent that any
remainder of the Claim qualifies within the description of such other Class or
Classes. A Claim is classified in a particular Class only to the extent that the
Claim is an Allowed Claim in that Class and has not been paid, released, or
otherwise satisfied prior to the Effective Date.
This Plan designates two (2) Classes of Claims and one (1) Class of
Interests as follows:
4.01 Allowed Unsecured Claim.
Class 1: Allowed Priority Unsecured Claims.
Class 2: Allowed General Unsecured Claims.
4.02 Interests.
Class 3: Interests of Equity Security Holders.
V.
NO CLASSES UNIMPAIRED BY THE PLAN
All Classes established by the Plan are impaired by the Plan, as that term
is defined by Section 1124 of the Bankruptcy Code.
VI.
TREATMENT OF IMPAIRED CLASSES OF CLAIMS
The following Classes are "impaired" by this Plan, as that term is defined
by Section 1124 of the Bankruptcy Code.
6.01 Class 1: Allowed Priority Unsecured Claims
Class 1 is impaired by this Plan. Except to the extent that the holder of a
particular Allowed Priority Unsecured Claim agrees otherwise, each Allowed
Priority Unsecured Claim shall be paid in full, in Cash, on the later of (i) the
Effective Date, or (ii) the fifth (5th) Business Day after the order allowing
such Priority Unsecured Claim becomes a Final Order. No post-petition interest
shall be paid with respect to any Allowed Priority Unsecured Claims; provided,
however, that in the event that there are funds remaining after the payment in
full of all Allowed Claims, interest shall be paid with respect to Allowed
Priority Unsecured Claims at the rate of ten percent (10%) per annum in
accordance with the provisions of Paragraph 7.06 of this Plan.
6.02 Class 2: Allowed General Unsecured Claims
Class 2 is impaired by this Plan. In full and complete satisfaction of the
Allowed General Unsecured Claims, each holder of a Class 2 Allowed General
Unsecured Claim shall be paid its pro rata share of the funds available in the
Plan Fund, up to 100% of the amount of its Allowed General Unsecured Claim. No
post-petition interest shall be paid with respect to any Allowed Priority
Unsecured Claims; provided, however, that in the event that there are funds
remaining after the payment in full of all Allowed Claims and the payment of
interest to holders of Allowed Priority Unsecured Claims and Allowed Priority
Tax Claims, interest shall be paid with respect to Allowed General Unsecured
Claims at the rate of ten percent (10%) per annum in accordance with the
provisions of Paragraph 7.06 of this Plan. Distributions to the holders of the
Class 2 Allowed General Unsecured Claims shall be made in accordance with the
provisions of Paragraph 7.04 of this Plan.
6.03 Class 3: Interests of Equity Security Holders
Class 3 is deemed to be impaired by this Plan. The Equity Security Holders
shall retain, without alteration or modification, all of their legal,
contractual and equitable rights in their Interests. The Equity Security
Holders' ownership interest in the Reorganized Debtor shall be diluted as of the
Effective Date, however, by reason of the issuance to InfiniCom, pursuant to the
provisions of the InfiniCom Stock Agreement, of Interests in the Reorganized
Debtor equivalent to approximately ninety-one percent (91%) of the issued and
outstanding Interests in the Reorganized Debtor.
Confirmation shall be deemed approval of all of the terms and conditions of
the InfiniCom Stock Agreement. The Debtor and InfiniCom shall take any and all
actions, and shall execute and deliver any and all documents and instruments,
appropriate to carry out and effectuate the terms and conditions of the
InfiniCom Stock Agreement as of the Effective Date.
The treatment of the Interests of Equity Security Holders under this Plan
is subject to the provisions of Paragraph 7.25 of this Plan. In accordance with
the provisions of Paragraph 7.25 of this Plan, in the event that the InfiniCom
Stock Agreement should be terminated, (i) the Equity Security Holders shall
retain, without alteration or modification, all of their legal, contractual and
equitable rights in their Interests, and (ii) the Committee may file with the
Bankruptcy Court, after all Distributions required by this Plan have been made,
a notice of cancellation of the Interests in the event that, by such date, the
Committee has not been able to enter into a transaction (e.g., a sale of the
Interests or merger transaction) to obtain value for Equity Security Holders on
account of the Interests.
VII.
EXECUTION AND IMPLEMENTATION OF THE PLAN
7.01 Overview
The purposes of this Plan are the following: (a) distributing to Creditors
the Cash in the Estate as of the Effective Date (derived primarily from the SMS
Asset Sale and the SIS Asset Sale and to be derived from the InfiniCom Stock
Agreement), and (b) providing to the Equity Security Holders Interests in the
Reorganized Debtor pursuant to the provisions of the InfiniCom Stock Agreement.
This Plan effectuates the provisions of the InfiniCom Stock Agreement. The
Debtor did not realize from the SMS Asset Sale and the SIS Asset Sale (i.e.,
sales, in the aggregate, of substantially all of the assets of the Debtor)
proceeds sufficient to pay to the Creditors 100% of their Allowed Claims. In
order for the Debtor to obtain additional funds with which to pay the Allowed
Claims of Creditors, the Debtor negotiated and entered into the InfiniCom Stock
Agreement, by which the Debtor will obtain from InfiniCom, in consideration of
the Debtor's transfer to InfiniCom pursuant to this Plan of approximately
ninety-one percent (91%) of the Interests in the Reorganized Debtor, up to
$225,000 (with interest thereon, as provided by the InfiniCom Stock Agreement),
plus reimbursement of up to $125,000 of the professional fees and costs of the
Estate incurred in connection with the negotiation and documentation of the
Debtor's transaction with InfiniCom, and the formulation, preparation and the
obtaining approval of the Disclosure Statement and this Plan. The Debtor
projects that, with the funds to be obtained from the InfiniCom Stock Agreement,
Distributions to Creditors of approximately 98% of the amount of Allowed General
Unsecured Claims should be paid in this Case.(F2) Moreover, by the InfiniCom
Stock Agreement, Equity Security Holders will be able to realize a more valuable
ownership interest in the Reorganized Debtor.
(F2) Please refer to Article VIII.C of the Disclosure Statement for an analysis
of the amount of Allowed Claims in the Case, and the projected
Distributions to Creditors.
7.02 Means for Implementation of this Plan
The Cash in the Estate as of the Confirmation Date and to be obtained
pursuant to Section 3.1 of the InfiniCom Stock Agreement will be distributed to
Creditors on account of their Allowed Claims pursuant to the provisions of this
Plan. Distributions to Creditors pursuant to this Plan track materially the
provisions of Section 726 of the Bankruptcy Code (i.e., the distribution scheme
in a Chapter 7 liquidation proceeding).
As of the Effective Date, the Debtor will transfer to the Disbursing Agent
all of the Cash in the Estate, and, on the Closing Date of the InfiniCom Stock
Agreement, InfiniCom will cause the Escrow Holder to pay to the Disbursing
Agent, on behalf of the Creditors, $225,000 plus accrued interest as provided
for under the InfiniCom Stock Agreement. The Disbursing Agent will make
Distributions to Creditors pursuant to the provisions of this Plan.
Ownership interests in the Reorganized Debtor will be determined pursuant
to the provisions of the InfiniCom Stock Agreement. On the Closing Date of the
InfiniCom Stock Agreement, the Debtor will issue and InfiniCom will acquire
approximately 61.6 million shares of common stock of the Debtor in exchange for
one hundred percent (100%) of the issued and outstanding shares of capital stock
of 24STORE. Upon consummation of the foregoing transaction, Equity Security
Holders will collectively have approximately a nine percent (9%) ownership
interest in the Reorganized Debtor, and InfiniCom will have approximately a
ninety-one percent (91%) ownership interest in the Reorganized Debtor. Approval
of this Plan will constitute approval of an amendment to the Reorganized
Debtor's Certificate of Incorporation to increase the authorized amount of
issued and outstanding shares of stock in the Reorganized Debtor in order to
facilitate the foregoing transaction.
InfiniCom anticipates that the following will constitute the Reorganized
Debtor's board of directors as of the Effective Date:
Karl-Magnus Karlsson (Chairman);
Michael Neame; and
Martin Clarke.
InfiniCom also anticipates that the following persons will be the
Reorganized Debtor's officers as of the Effective Date:
Name Title
---- -----
Karl-Magnus Karlsson President
Michael Neame Chief Financial Officer
Martin Clarke Secretary
InfiniCom intends to cause the Reorganized Debtor to act diligently to
apply for and obtain a re-listing of its securities on the NASDAQ market as soon
as practicable following the Effective Date and, subject to market conditions,
presently intends to consummate a public offering of common stock of the
Reorganized Debtor. InfiniCom anticipates that the foregoing transactions will
serve to enhance the value and marketability of the Equity Security Holders'
ownership interests in the Reorganized Debtor.
SOME OF THE MATTERS DISCUSSED HEREIN CONTAIN FORWARD-LOOKING STATEMENTS
THAT INVOLVE RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THOSE SUGGESTED IN SUCH FORWARD-LOOKING STATEMENTS, INCLUDING,
WITHOUT LIMITATION, THE FAILURE TO EFFECT A RE-LISTING, THE FAILURE TO EFFECT A
PUBLIC OFFERING, THE EFFECT OF ECONOMIC CONDITIONS ON THE 24STORE BUSINESS,
INTEREST RATES, MARKET DEMAND, COMPETITION AND OTHER RISKS DETAILED IN THE
DISCLOSURE STATEMENT.
7.03 Payments to Holders of Allowed Administrative Claims, Allowed Priority
Tax Claims, and Class 1 Allowed Priority Unsecured Claims
Except as provided expressly to the contrary in Paragraph 7.06 of this
Plan, Allowed Administrative Claims, Allowed Priority Tax Claims, and Class 1
Allowed Priority Unsecured Claims (collectively, "Allowed Priority Claims")
shall be paid from the funds on hand in the Estate as of the Effective Date and
prior to the creation of the Plan Fund. All Distributions to the holders of
Allowed Priority Claims shall be made by the Disbursing Agent.
In the event that any objection to any Administrative Claim, Priority Tax
Claim, or Priority Unsecured Claim (collectively, "Priority Claims") should be
pending as of the date on which a Distribution is owed to the holder of such
Priority Claim, the Disbursing Agent shall reserve from the funds in the Estate
cash sufficient to pay such disputed Priority Claim ("Disputed Priority Claim"),
as if such Disputed Priority Claim were allowed in full. No Distribution shall
be made on account of any Disputed Priority Claim until such Disputed Priority
Claim has been determined and allowed by a Final Order. Pending the entry of any
Final Order allowing a Disputed Priority Claim, all payments owed with respect
to such Disputed Priority Claim shall be deposited into an interest-bearing
segregated bank account at a financial institution authorized by the United
States Trustee guidelines ("Disputed Priority Claims Reserve"). No disbursements
shall be made from the Disputed Priority Claims Reserve for a Disputed Priority
Claim without the written consent of the Disbursing Agent and the holder of such
Disputed Priority Claim, or order of the Bankruptcy Court.
In the event that a Disputed Priority Claim is allowed by a Final Order,
the amount reserved in the Disputed Priority Claims Reserve for such Allowed
Priority Claim shall be disbursed, within five (5) Business Days, to the holder
of such Allowed Priority Claim to the extent of the amount of the Allowed
Priority Claim, and any further Distributions on account of such Allowed
Priority Claim shall be paid directly to the holder of such Allowed Priority
Claim (and not to the Disputed Priority Claims Reserve), in an aggregate amount
not to exceed the amount of the Priority Claim allowed by the Final Order. In
the event that any Disputed Priority Claim is ultimately disallowed in whole or
in part by a Final Order, any amount reserved in the Disputed Priority Claims
Reserve for such Disputed Priority Claim in excess of any amount of the Priority
Claim allowed by such Final Order shall be transferred, within five (5) Business
Days, to the Plan Fund, for the purpose of making Distributions on account of
Allowed Claims under this Plan.
7.04 Payments to Holders of Allowed General Unsecured Claims
Subject to the provisions of Paragraph 6.01 of this Plan, holders of Class
2 Allowed General Unsecured Claims shall receive their pro rata share of the
available funds in the Plan Fund (after Distributions have been made to, or
appropriate reserves established in the Disputed Priority Claims Reserve for,
the holders of Priority Claims, and after the establishment of the Reserve
Fund). In the event that any funds are reallocated to the Plan Fund as a result,
among other things, of (i) the resolution of any objection which may be filed to
Disputed Claims, (ii) the obtaining of any Net Litigation Proceeds, (iii) the
obtaining of any net proceeds from the disposition of any Retained Assets, (iv)
the termination of the Unclaimed Distribution Reserve, or (v) the termination of
the Reserve Fund, the holders of the Class 2 Allowed General Unsecured Claims
shall also receive their pro rata share of any funds so reallocated. All
Distributions to the holders of Class 2 Allowed General Unsecured Claim shall be
made by the Disbursing Agent. Holders of Class 2 Allowed General Unsecured
Claims shall receive an initial Distribution of their pro rata share of the Plan
Fund within sixty (60) days following the Effective Date, after the
establishment of the Disputed General Unsecured Claims Reserve provided for in
Paragraph 7.05 of this Plan. Subject to the distribution to Creditors of any
Unclaimed Distributions pursuant to Paragraph 7.14 of this Plan, holders of
Class 2 Allowed General Unsecured Claims shall receive a Final Distribution on
account of their Allowed Claims within thirty (30) days after the filing of the
Committee's Certificate referenced in Paragraph 7.12 of this Plan, or at such
later time as is practical.
7.05 Disputed General Unsecured Claims
In the event that any objection to any Class 2 General Unsecured Claim
shall be pending as of the date on which a Distribution is owed to the holder of
such Class 2 General Unsecured Claim, the Disbursing Agent shall reserve from
the funds in the Estate available to pay the Class 2 General Unsecured Claims
cash sufficient to pay such disputed Class 2 General Unsecured Claim ("Disputed
General Unsecured Claim"), as if such Disputed General Unsecured Claim were
allowed in full. No Distribution shall be made on account of any Disputed
General Unsecured Claim until such Disputed General Unsecured Claim has been
determined and allowed by a Final Order. Pending the entry of a Final Order
allowing a Disputed General Unsecured Claim, all payments owed with respect to
such Disputed General Unsecured Claim shall be deposited into an
interest-bearing, segregated bank account at a financial institution authorized
by the United States Trustee guidelines ("Disputed General Unsecured Claims
Reserve"). No disbursements shall be made from the Disputed General Unsecured
Claims Reserve for a Disputed General Unsecured Claim without the written
consent of the Disbursing Agent and the holder of such Disputed General
Unsecured Claim, or order of the Bankruptcy Court.
In the event that a Disputed General Unsecured Claim is allowed by a Final
Order, the amount reserved in the Disputed General Unsecured Claims Reserve for
such Allowed General Unsecured Claim shall be disbursed, within five (5)
Business Days, to the holder of such Allowed General Unsecured Claim to the
extent of the amount of the Allowed General Unsecured Claim, and any further
Distributions on account of such Allowed General Unsecured Claims shall be paid
directly to the holder of such Allowed General Unsecured Claim (and not to the
Disputed General Unsecured Claims Reserve), in an aggregate amount not to exceed
the amount of the General Unsecured Claim allowed by the Final Order.
In the event that any Disputed General Unsecured Claim is ultimately
disallowed in whole or in part by a Final Order, any amount reserved in the
Disputed General Unsecured Claims Reserve for such Disputed General Unsecured
Claim in excess of any amount of the General Unsecured Claim allowed by such
Final Order shall be transferred, within five (5) Business Days, to the Plan
Fund, for the purpose of making Distributions to holders of Allowed Claims in
accordance with the terms of this Plan.
7.06 Interest on Allowed Claims
Interest shall not be paid from the Petition Date on any Allowed Claims,
unless there are funds remaining in the Estate after payment in full of the
principal amount of all Allowed Claims. In that event, interest on Allowed
Claims shall be paid from the Plan Fund as follows:
(a) First, interest shall be paid on any Allowed Priority Unsecured
Claim (in accordance with the priority set forth by Section 507 of the
Bankruptcy Code), from the Petition Date through and including the date of
payment of the Allowed Priority Unsecured Claim, at the rate of ten percent
(10%) per annum.
(b) Second, after payment of interest owed on any Allowed Priority
Unsecured Claims, interest shall be paid on any Allowed Priority Tax Claim,
from the Petition Date through and including the date of payment of such
Allowed Priority Tax Claim, at the lesser of (i) the rate of ten percent
(10%) per annum, or (ii) the rate specified by Section 6621 of the Internal
Revenue Code, as such rate may be adjusted from time to time.
(c) Third, after payment of interest owed on any Allowed Priority
Unsecured Claims and Allowed Priority Tax Claims, interest shall be paid on
each Allowed General Unsecured Claim, from the Petition Date through and
including the payment of such Allowed General Unsecured Claim, at the rate
of ten percent (10%) per annum.
7.07 The Committee
The Committee, as its membership may be modified or supplemented after the
Confirmation Date, shall continue to act after the Confirmation Date as the duly
appointed and acting representative of the holders of General Unsecured Claims
(Class 2) and shall have the rights and powers provided for by this Plan. In
carrying out its responsibilities under this Plan, the Committee shall be
entitled to employ such counsel including, without limitation, the law firm of
Pachulski, Stang, Ziehl & Young (counsel retained by the Committee in the Case)
and other professionals as may be necessary, in the exercise of its sole
discretion, to assist it in the performance of its duties under this Plan. Fees
and expenses of professionals employed by the Committee shall be paid from funds
on deposit in the Reserve Fund, in accordance with the provisions of Paragraph
7.10 of this Plan. In the event of a withdrawal by a member of the Committee
after the Confirmation Date, a replacement member shall be promptly appointed by
the remaining members of the Committee.
7.08 Post-Confirmation Estate Claims
The right to enforce, file, litigate, collect, prosecute, settle, and
resolve on behalf of the Estate and the Debtor (at the expense of the Estate)
any and all claims and causes of action which constitute property of the Estate
including, but not limited to, any Avoidance Actions, whether or not such claims
or causes of action are the subject of litigation pending as of the Effective
Date (collectively, the "Post-Confirmation Estate Claims"), is deemed
automatically transferred from the Debtor and/or the Estate, as the case may be,
to the Committee on the Effective Date. From and after the Effective Date, the
Reorganized Debtor shall have no right to enforce, prosecute, file, collect,
settle, or resolve any Post-Confirmation Estate Claims (unless specifically
requested in writing by the Committee to assist the Committee in such regard and
upon satisfactory indemnification).
Any litigation based upon Post-Confirmation Estate Claims shall be filed no
later than one hundred eighty (180) days after the Effective Date, or within
such additional period of time as the Bankruptcy Court may allow upon motion of
the Committee, after such notice as the Bankruptcy Court may deem appropriate.
In the event that litigation based upon any Post-Confirmation Estate Claim is
not timely commenced, such Post-Confirmation Estate Claim shall be deemed
forever waived by the Estate and neither the Committee nor any other
party-in-interest shall have the right to pursue the same; provided, however,
that any such Post-Confirmation Estate Claim may be utilized as a defense
against or offset to any Claim or cause of action which may be brought against
the Estate. Any net proceeds realized from the litigation of any
Post-Confirmation Estate Claim ("Net Litigation Proceeds") shall be reallocated
to the Plan Fund and made available for distribution to holders of Class 2
Allowed General Unsecured Claims under this Plan.
Notwithstanding the rights of the Committee with respect to
Post-Confirmation Estate Claims, nothing in this Plan shall require the
Committee to prosecute or litigate any such matters, all of which may be decided
by the Committee in its sole discretion.
Neither the Debtor nor the Committee has fully reviewed whether
Post-Confirmation Estate Claims exist, including, without limitation, whether or
not there are any Avoidance Actions which may be brought by the Committee after
the Effective Date. This investigation is on-going and will occur in large part
after the Effective Date. As a result, Creditors and other parties-in-interest
should be, and are pursuant to the terms of this Plan, specifically advised
that, notwithstanding that the existence of any particular Post-Confirmation
Estate Claim may not be listed, disclosed, or set forth in this Plan or
Disclosure Statement, a Post-Confirmation Estate Claim may be brought against
any Claimant at any time, subject to the bar date limitations set forth in this
Plan.
7.09 Objections to Claims
The right to prosecute, collect, file, litigate, resolve, and settle Claims
(at the expense of the Estate), whether pending or the subject of litigation as
of the Effective Date, shall be deemed automatically transferred by the Debtor
and/or the Estate, as the case may be, to the Committee on behalf of the Estate
and the Debtor as of the Effective Date. From and after the Effective Date, the
Reorganized Debtor shall have no right to file, prosecute, litigate, or settle
any objections to Claims, whether or not any such objection is pending as of the
Effective Date (unless specifically requested in writing by the Committee to
assist the Committee in such regard and upon satisfactory indemnification).
Objections to any Priority Claim shall be filed within thirty (30) days
after the Effective Date, or within such additional period of time as the
Bankruptcy Court may allow upon motion made after such notice as the Bankruptcy
Court may deem appropriate. Objections to any Class 2 General Unsecured Claim
shall be filed within forty-five (45) days after the Effective Date, or within
such additional period of time as the Bankruptcy Court may allow upon motion
made after such notice as the Bankruptcy Court may deem appropriate. Any such
objection which is not timely filed shall be deemed forever waived by the Estate
and neither the Committee nor any other party-in-interest shall have any right
to pursue the same.
Notwithstanding that the Committee shall have the right to prosecute, file,
litigate, resolve, and settle objections to Claims on behalf of the Debtor and
Estate, nothing contained herein shall be deemed to obligate the Committee to
take any such actions, all of which shall be determined in the Committee's sole
discretion.
The Debtor has filed a number of objection to Disputed Claims; however,
neither the Debtor nor the Committee has fully reviewed the Claims in the Case
to determine whether any additional objections to Disputed Claims should be
filed in this Case. This investigation is ongoing and will occur in part after
the Effective Date. As a result, Creditors and other parties-in-interest should
be, and are pursuant to the terms of this Plan, specifically advised that,
notwithstanding that the existence of any particular objection to Claim may not
be listed, disclosed or set forth in this Plan or Disclosure Statement, an
objection to Claim may be brought against any Claimant at any time, subject to
the bar date limitations set forth in this Plan.
7.1 Reserve Fund
On or as soon as practicable after the Effective Date, the sum of $75,000
shall be set aside in the Reserve Account to be held by the Disbursing Agent for
the purposes of funding (i) the estimated attorneys' fees and costs and other
estimated costs of any litigation which the Committee intends to pursue after
the Effective Date, including, without limitation, the prosecution of
Post-Confirmation Estate Claims and/or objections to Claims, (ii) the costs of
disposition of any Retained Assets, and (iii) the expenses that the Committee
may incur in connection with the implementation of this Plan, including, without
limitation, the compensation of the Disbursing Agent.
In the event that, after the Effective Date, the Committee should
determine, in the exercise of its sole discretion, that the initial $75,000
funding of the Reserve Fund is insufficient to fund the post-confirmation
expenses set forth in this Paragraph 7.10, at the written request of the
Committee, the Disbursing Agent shall transfer to the Reserve Fund any
additional funds within his possession or control requested by the Committee,
but in no event to exceed an additional sum of $50,000. The Reserve Fund shall
be established in an interest-bearing account with a financial institution which
is an authorized depository under the United States Trustee guidelines and shall
be under the control of the Disbursing Agent.
7.2 Payment of Professionals' Fees and Expenses After the Confirmation Date
Any professional employed in the Case after the Confirmation Date shall be
entitled to obtain payment of its fees and costs as a post-confirmation
operating expense without the need for any further order of the Bankruptcy Court
with respect thereto. Any professional seeking compensation of post-confirmation
fees and costs shall submit to the Disbursing Agent and serve upon the Committee
and its counsel a billing statement which shall include documentation of fees
and costs which conforms substantially to the United States Trustee guidelines.
If any party-in-interest fails to file, in the Bankruptcy Court, an objection to
any such billing statement within fifteen (15) days after the service of such
billing statement, the fees and costs requested thereby shall be deemed allowed,
and the professional shall thereafter immediately be entitled to the
compensation requested thereby and the Disbursing Agent shall forthwith pay such
compensation to the professional from the Reserve Fund. If a timely objection to
the professional's billing statement is filed by any party-in-interest, the
professional shall schedule the matter for hearing before the Bankruptcy Court
and the Bankruptcy Court will determine the merits of the objection.
If the Disbursing Agent should fail to pay the post-confirmation fees and
costs of any professional entitled to such payment within thirty (30) days after
the professional's rendering of its billing statement, the professional shall be
entitled to seek an order of the Bankruptcy Court requiring the Disbursing Agent
to forthwith pay such fees and costs to the professional by filing a motion to
compel the payment of the professional's Claim.
7.3 Filing of Post-Confirmation Reports; Committee's Certificate; and
Termination of Reserve Fund
The Committee shall file and serve upon the Disbursing Agent, the
Reorganized Debtor and its counsel, not less frequently than every ninety (90)
days after the Effective Date, a report regarding the status of the
administration of the Case. Such report shall include, among other things, a
narrative regarding the status of the prosecution of any Post-Confirmation
Estate Claims and any objections to Claims. As soon as reasonably practicable
after the Committee determines in its discretion that all Allowed Priority
Claims have been duly paid, all Post-Confirmation Estate Claims and objections
to Claims have been resolved by Final Order, and that all Retained Assets have
been appropriately disposed of or that no further action should be taken
relative thereto, the Committee shall file and serve upon the Disbursing Agent
and the Reorganized Debtor and its counsel a certificate attesting to such
determination ("Committee's Certificate"). Within the later of thirty (30) days
after the filing of the Committee's Certificate or ten (10) days after payment
to professionals of their final post-confirmation fees, the Reserve Fund shall
be terminated, and any remaining funds contained therein shall be reallocated to
the Plan Fund for distribution to the holders of Allowed Claims as provided for
by this Plan ("Final Distribution"), which Final Distribution shall be made
within thirty (30) days thereafter, or at such later time as is practical.
7.4 Closing of the Case
Promptly after the making of any Unclaimed Distributions pursuant to
Paragraph 7.14 of this Plan, the Committee shall file with the Court an
application for a final decree, closing the Case.
7.5 Unclaimed Distributions
Distributions to holders of Allowed Claims shall be made: (a) at the
addresses set forth in the Proofs of Claim filed by the Claimant; (b) at the
addresses set forth in any written notices of address change delivered to the
Debtor or the Disbursing Agent after the date on which any related Proof of
Claim was filed; or (c) at the addresses reflected in the Schedules relating to
the applicable Allowed Claim if no Proof of Claim has been filed by the Claimant
and neither the Debtor nor the Disbursing Agent has received a written notice of
a change of address. Neither the Debtor, the Committee, nor the Disbursing Agent
shall be required to perform any investigation or inquiry as to the proper
address for such Creditor if the address stated in the Proof of Claim, written
notice of change of address, or in the Schedules is incorrect.
Any unclaimed Distribution ("Unclaimed Distribution") provided for under
this Plan (which shall include (i) checks which have been returned as
undeliverable without a proper forwarding address, (ii) checks which were not
mailed or delivered because of the absence of a proper address to which to mail
or deliver the same, or (iii) checks which remain unclaimed for period of ninety
(90) days) shall be deposited by the Disbursing Agent into an Unclaimed
Distribution reserve account ("Unclaimed Distribution Reserve") to be held in
trust for the benefit of the holders of Allowed Claims entitled thereto under
the terms of this Plan. For the earlier to occur of (i) two (2) years after a
Distribution is deposited into the Unclaimed Distribution Reserve, or (ii)
ninety (90) days after the making of the Final Distribution under this Plan (the
"Unclaimed Distribution Holding Period"), such Unclaimed Distribution shall be
held in the Unclaimed Distribution Reserve for the benefit of the holder of the
Allowed Claim who failed to previously claim such Unclaimed Distribution. After
the expiration of the Unclaimed Distribution Holding Period for an Unclaimed
Distribution, such Unclaimed Distribution shall be transferred to the Plan Fund
and a Distribution thereof shall be made to holders of Allowed Claims as
provided for by this Plan, and the holders of Allowed Claims otherwise entitled
to such Unclaimed Distributions shall cease to be entitled thereto and their
Claims based thereon shall be deemed waived and forever barred. After the making
of all Distributions required by this Plan, the Plan Fund shall be terminated,
and any remaining funds contained therein shall be paid over to the Reorganized
Debtor.
7.6
[INTENTIONALLY OMITTED]
7.7 Disposition of Retained Assets
The Committee shall be entitled to sell, transfer, or otherwise dispose of,
on behalf of the Debtor and the Estate, non-Cash assets retained by the Estate
as of the Effective Date, excluding all of the Debtor's right, title and
interest in, to and under the InfiniCom Stock Agreement ("Retained Assets"). The
Committee shall have no obligation to pursue the disposition of any Retained
Asset, and the Committee shall have no liability for actions taken or omitted to
be taken with respect to the disposition of any Retained Asset, other than for
its willful misconduct or fraud. In the event that any such Retained Asset is
not disposed of within one hundred eighty (180) days after the Effective Date or
within such additional period of time as the Bankruptcy Court may allow upon
motion made after such notice as the Bankruptcy Court may deem appropriate, such
Retained Asset shall be deemed to be abandoned and of no value to the Estate.
7.8 Compromise of Controversies
Bankruptcy Court approval of compromises of any controversies relating to
objections to Claims, Post-Confirmation Estate Claims, and any litigation
pending after the Confirmation Date may be obtained on an expedited basis after
the Confirmation Date. Notice of any such proposed compromise shall be provided
to the following entities: (i) the Committee members and the Committee's
counsel; (ii) the Disbursing Agent; (iii) the United States Trustee; and (iv)
any Creditor who files and serves upon the Debtor, the Committee, and their
respective counsel a request for special notice of any such compromises after
the Confirmation Date. Objections to any such proposed compromise shall be filed
within fifteen (15) days after service of the notice of the proposed compromise.
In the event that no objections to the proposed compromise are timely filed, the
compromise shall be deemed approved, and an order may be entered by the
Bankruptcy Court approving the compromise, without the need for further notice
or hearing with respect thereto.
7.9 De Minimis Distributions
The Disbursing Agent shall not be required to make a Distribution to any
Creditor if the amount of Cash to be distributed to the Creditor is less than
$15.00. Such Creditor shall have its Claim for such Distribution discharged, and
such Creditor shall be forever barred from asserting any such Claim against the
Debtor, the Reorganized Debtor, or the Estate. Any such Cash held by the
Disbursing Agent shall be reallocated to the Plan Fund for distribution on a
pro-rata basis to other Creditors. When no further Distributions are required to
be made under this Plan, any remaining funds shall be distributed to the
Reorganized Debtor.
7.10 Bankruptcy Court Approval Relative to Post-Confirmation Matters
Nothing contained in this Plan shall be deemed to impair in any manner the
right of any party-in-interest, including, without limitation, the Committee, to
seek at any time after the Confirmation Date orders of the Bankruptcy Court
approving actions to be taken consistent with this Plan as may be necessary or
desirable to effectuate the provisions of this Plan.
7.11 Setoffs
Pursuant to Section 553 of the Bankruptcy Code or applicable non-bankruptcy
law, the Committee, acting on behalf of the Debtor and the Estate, may set off
against any Allowed Claim and Distributions to be made pursuant to this Plan on
account of such Allowed Claim (before any Distribution is made on account of
such Allowed Claim), any account stated, claim, right, or cause of action which
the Debtor or the Estate may possess against the holder of such Allowed Claim;
provided, however, that neither the failure to effect such a setoff nor the
allowance of any Claim shall constitute a waiver or release by the Debtor, the
Estate, or the Committee of any such account, claim, right, and cause of action
that the Debtor or the Estate may possess against the holder of such Allowed
Claim. To the extent that the Committee in allowing a Claim fails to effect a
setoff with a Creditor and seeks to collect a claim from such Creditor after a
Distribution to such Creditor pursuant to this Plan on account of the Creditor's
Allowed Claim, the Committee shall be entitled to full recovery on its claim
against such Creditor, notwithstanding any payment in full of the Creditor's
Allowed Claim pursuant to this Plan.
7.12 Cash Payments
Cash payments made pursuant to this Plan shall be in United States dollars
by checks drawn on a domestic bank selected by the Disbursing Agent or by wire
transfer from a domestic bank, at the option of the Disbursing Agent.
7.13 Management of the Reorganized Debtor
The key management of the Reorganized Debtor, and the compensation to be
paid to such managers, is set forth in detail in Article XV of the Disclosure
Statement.
7.14 Remedy Upon Any Default Under this Plan
In the event that any Creditor is not paid a Distribution to which it is
entitled pursuant to the terms of this Plan, such Creditor may file in the
Bankruptcy Court a motion to obtain any appropriate relief based upon such
default after providing to the Disbursing Agent not less than thirty (30) days
written notice of and opportunity to cure such default.
7.15 Further Assurances by Reorganized Debtor
The Reorganized Debtor shall cooperate with the Committee and the
Disbursing Agent and shall take any and all actions, and shall execute and
deliver any and all documents and instruments, appropriate to facilitate the
effectuating of this Plan, including, without limitation, by taking any actions
required on its part to cause all assets of the Estate which come into its
possession or control to be transferred promptly to the Disbursing Agent.
7.16 Severability of Provisions Relating to InfiniCom or InfiniCom Stock
Agreement
Notwithstanding any provision to the contrary contained in this Plan, in
the event that the InfiniCom Stock Agreement is terminated in accordance with
the terms of the InfiniCom Stock Agreement, the Debtor, with the Committee's
consent (which consent shall not be unreasonably withheld), shall have the right
to elect to cause this Plan to be effective, notwithstanding any such
termination of the InfiniCom Stock Agreement, by filing with the Bankruptcy
Court a notice of such election, in which event the Plan shall become effective
as provided herein, save and except only for any provisions hereof relating to
InfiniCom or to the InfiniCom Stock Agreement which provisions (including,
without limitation, the provisions relating to InfiniCom and to the InfiniCom
Stock Agreement contained in Paragraph 6.02 hereof) shall be deemed to be void,
of no effect and to have been severed from this Plan.
7.17 Change of Name
In the event that the Debtor should sell the Debtor's corporate name,
"Scoop, Inc.," the Debtor shall cease using such corporate name and adopt a new
name with the approval of InfiniCom, which approval shall not be unreasonably
withheld.
7.18 Cancellation of Shares and Warrants
Upon the Closing Date, all outstanding options and warrants to acquire
stock in the Debtor shall be canceled automatically and without any need to give
any notice thereof to the holders of such options and warrants, and the holders
of such options or warrants shall have, on account of such options or warrants,
no right to acquire any stock in the Reorganized Debtor. Any Claim which may
arise as a result of any such cancellation of any options or warrants shall be
filed and served upon the Committee and counsel for the Committee within thirty
(30) days after the Effective Date. In the event that any such Proof of Claim is
not filed and served as set forth herein, such Claim shall be deemed
conclusively to be waived and shall be forever barred in the Case, without
further notice. Claims timely asserted hereunder arising out of the rejection of
executory contracts or unexpired leases shall be deemed to be Class 2 General
Unsecured Claims under this Plan but shall not automatically become an Allowed
Claim.
In the event that the InfiniCom Stock Agreement should be terminated and
this Plan become effective pursuant to the provisions of Section 7.25 of this
Plan, the rights of the holders of such options or warrants pursuant to such
options and warrants shall not be altered by this Plan and the holders of such
options and warrants shall retain all of the rights which they may have pursuant
to such options or warrants.
VIII.
DISBURSING AGENT
The terms of the appointment of the Disbursing Agent under this Plan shall
be as follows:
8.01 Appointment of Disbursing Agent
Bruce W. Ballenger shall be appointed to act as Disbursing Agent under this
Plan, effective as of the Effective Date. The Disbursing Agent shall be
responsible for administering (subject to the terms of this Plan) all funds in
the Plan Fund, the Disputed Priority Claims Reserve, the Disputed General
Unsecured Claims Reserve, the Reserve Fund, and the Unclaimed Distribution
Reserve, and shall be responsible for making all Distributions to Creditors
(including professionals) pursuant to this Plan. All accounts maintained by the
Disbursing Agent shall specifically state that they are trust accounts and shall
not be commingled. The Disbursing Agent shall be entitled to exercise the
following rights and powers in carrying out his responsibilities under this
Plan:
8.02 Distributions in Accordance With Claims Docket
Except as set forth to the contrary in Paragraphs 8.03 and 8.04 hereof, the
Disbursing Agent may make Distributions with respect to a Claim in accordance
with, and in reliance on, the Claims docket and Schedules, unless there is an
objection pending with respect to such Claim. All checks and correspondence
therewith shall reference that the checks must be cashed within ninety (90) days
of their date.
8.03 Preliminary Schedule of Proposed Distributions
The Disbursing Agent shall prepare, and provide to the Committee, a
preliminary schedule of proposed Distributions to Creditors ("Distribution
Schedule") at least five (5) days prior to the making of any such Distributions.
No Distribution shall be made without the written approval thereof by the
Committee. In the event that the Committee objects to the making of any proposed
Distribution set forth on the Distribution Schedule, the Disbursing Agent shall
not make such Distribution until such objection is resolved with the Committee
or an order of the Bankruptcy Court approving such Distribution is obtained by
the Disbursing Agent. Notwithstanding the foregoing, it shall be the sole
responsibility of the Disbursing Agent to determine the accuracy of
Distributions to be made pursuant to this Plan, and the Committee shall have no
responsibility therefor. In the event that the Disbursing Agent so desires, the
Disbursing Agent shall be entitled to seek, on an ex parte basis, an order of
the Bankruptcy Court approving the making of the Distributions pursuant to the
Distribution Schedule.
8.04 Reporting to Committee
The Disbursing Agent shall provide to the Committee reports regarding the
funds controlled by the Disbursing Agent and Distributions under this Plan, as
may be reasonably requested by the Committee.
8.05 Employment of Agents
With the consent of the Committee or upon order of the Bankruptcy Court,
the Disbursing Agent may employ and act through agents and confer upon them such
power and authority as may be necessary or advisable to fulfill the Disbursing
Agent's obligations hereunder and may compensate such agents and charge such
expenses, to the extent such expenses are reasonable, from funds on deposit in
the Reserve Fund.
8.06 Investment of Funds
To the extent practicable, the Disbursing Agent shall invest funds in the
Plan Fund, the Disputed Priority Claims Reserve, the Disputed General Unsecured
Claims Reserve, the Reserve Fund, and the Unclaimed Distribution Reserve in any
manner permitted by the Bankruptcy Code, and any order of the Bankruptcy Court
that may establish investment guidelines for funds of the Estate.
8.07 Employment and Compensation of Disbursing Agent
The Disbursing Agent's fee shall be capped at one and one-half percent (1
1/2%) of Distributions made on account of Allowed Claims. In addition to such
fee, the Disbursing Agent shall be entitled to obtain reimbursement for his
expenses incurred in connection with the performance of his duties pursuant to
this Plan (including, without limitation, for any expense associated with the
bond required by Paragraph 8.08 hereof). The Disbursing Agent may obtain
compensation and reimbursement for his expenses by filing a billing statement
setting forth his entitlement to such compensation and reimbursement of
expenses, and by serving such billing statement upon the members of the
Committee and the Committee's counsel. If any party-in-interest fails to file in
the Bankruptcy Court an objection to any such billing statement within fifteen
(15) days after service of such billing statement, the Disbursing Agent shall
thereafter immediately be entitled to the compensation requested thereby and the
Disbursing Agent shall be entitled to forthwith withdraw from the Reserve Fund
funds sufficient to pay such compensation. If a timely objection to the
Disbursing Agent's billing statement is filed by any party-in-interest, the
Disbursing Agent shall schedule the matter for hearing before the Bankruptcy
Court and the Bankruptcy Court will determine the merits of the objection.
8.08 Disbursing Agent's Bond
The Disbursing Agent shall be bonded at the expense of the Estate, with the
amount of such bond set in the amount of the funds on hand in the Estate on the
Effective Date, subject to reduction as Distributions are made pursuant to this
Plan.
8.09 Compliance with Tax Requirements
To the extent applicable, the Disbursing Agent shall comply with all tax
withholding and reporting requirements imposed upon him by any governmental
unit, and all Distributions pursuant to this Plan shall be subject to such tax
withholding and reporting requirements.
8.10 Resignation
The Disbursing Agent may resign at any time at will upon thirty (30) days
written notice to the members of the Committee and the Committee's counsel. The
resigning Disbursing Agent shall be entitled to retain any compensation paid to
him prior to his resignation and shall also be entitled to fees owed to him at
the time of his resignation. Upon any resignation of the Disbursing Agent, the
Committee, after consultation with the Office of the United States Trustee,
shall appoint a replacement Disbursing Agent.
8.11 Reorganized Debtor's Non-Responsibility for Distributions
The Reorganized Debtor shall have no responsibility for the making of any
of the Distributions provided for by this Plan, and shall have no liability for
any failure by the Disbursing Agent or by any other entity to properly make the
Distributions provided for by this Plan.
8.12 Reorganized Debtor's Non-Liability for Post-Confirmation
Administrative Expense
The Reorganized Debtor shall have no liability for any expense that may be
incurred after the Confirmation Date by the Disbursing Agent or by the Committee
in connection with the administration of this Plan.
IX.
REQUEST FOR FINDINGS OF FAIR AND EQUITABLE
TREATMENT OF IMPAIRED CLASSES
The Debtor, as the proponent of this Plan, hereby requests, pursuant to
Section 1129(b) of the Bankruptcy Code, that the Bankruptcy Court find and
determine that the provisions of this Plan provide fair and equitable treatment
to those Classes which are impaired under this Plan and which elect not to
accept this Plan, and that the Bankruptcy Court confirm this Plan
notwithstanding the requirement of Section 1129(a)(8) of the Bankruptcy Code as
to such Classes.
X.
CONDITIONS PRECEDENT TO DISTRIBUTIONS UNDER THE PLAN
In addition to any other terms and conditions set forth in this Plan or in
the Confirmation Order, the following shall constitute conditions precedent to
any Creditor's right to participate in the Distributions under this Plan.
10.01 Further Assurances by Creditor
As a condition to participation in the Distributions under this Plan, all
Creditors shall execute and deliver to the Committee or the Disbursing Agent, or
join in the execution and delivery of, any document appropriate for the
consummation of this Plan.
10.02 Creditor's Payment of Obligations to Debtor or Turn Over of Property
to the Estate
As a condition to participation in the Distributions under this Plan, any
Creditor from which property is recoverable under Sections 542, 543, 550, or 553
of the Bankruptcy Code, or otherwise, or that is a transferee of a transfer
avoidable under Sections 522, 544, 545, 547, 548, or 549 of the Bankruptcy Code,
or otherwise, shall pay the amount or turn over any such property for which such
entity or transferee is liable to the Debtor under Sections 522, 542, 543, 550,
or 553 of the Bankruptcy Code, or otherwise.
10.03 Wage Claimants' and other Creditors' Execution and Delivery of W-4
and Related Forms
Notwithstanding anything to the contrary contained in this Plan, as a
condition to participation in the Distributions under this Plan, any Wage
Claimant or any other Creditor, whether the holder of an Allowed General
Unsecured Claim, Allowed Priority Claim, or otherwise, shall duly fill out and
return to the Disbursing Agent a W-4 claim form, or any other tax reporting form
as may be reasonably requested by the Disbursing Agent. No Distributions shall
be paid with respect to the Allowed Claim of any Wage Claimant or other Creditor
until fourteen (14) days after the W-4 form and any other tax reporting forms
which the Disbursing Agent provides to the Wage Claimant or other Creditor are
returned, properly completed, to the Disbursing Agent. If any such W-4 forms or
other tax reporting forms are not returned to the Disbursing Agent by the Wage
Claimant or other Creditor within sixty (60) days after the Disbursing Agent's
providing of such forms to the Wage Claimant or other Creditor, the Wage
Claimant or other Creditor otherwise entitled to Distributions under this Plan
shall cease to be entitled thereto, and their Claims based thereon shall be
deemed to be, and shall be, waived, forever barred, and automatically disallowed
with no need for any further action by the Disbursing Agent or order of the
Bankruptcy Court.
XI.
MODIFICATION OF PLAN
The Debtor may propose amendments or modifications of this Plan at any time
prior to the Confirmation Date with leave of the Bankruptcy Court and upon such
notice as the Bankruptcy Court requires; provided, however, that any amendment
or modification of this Plan which affects materially the rights of InfiniCom or
24STORE pursuant to the InfiniCom Stock Agreement or this Plan shall require the
written consent of InfiniCom, which consent shall not be unreasonably withheld.
After the Confirmation Date, the Reorganized Debtor or the Committee may, with
the approval of the Bankruptcy Court, and so long as it does not materially or
adversely affect the interests of Creditors or Equity Security Holders, remedy
any defect or omission, or reconcile any inconsistencies in this Plan, or in the
Confirmation Order, in such manner as may be necessary to carry out the purposes
and effect of this Plan. If the Bankruptcy Court determines that a
post-confirmation modification of this Plan is in the best interest of the
Estate and the Creditors, even after substantial consummation of this Plan,
then, notwithstanding the provisions of Section 1127(b) of the Bankruptcy Code,
the Bankruptcy Court may authorize such modification of this Plan, after notice
and a hearing, in such manner and under such conditions, as the Bankruptcy Court
deems appropriate.
XII.
TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES
12.01 Executory Contracts and Unexpired Leases to be Rejected
On the Confirmation Date, except for the InfiniCom Stock Agreement and for
any executory contract or unexpired lease specifically assumed or rejected
pursuant to a prior order of the Bankruptcy Court, each executory contract or
unexpired lease entered into by the Debtor prior to the Petition Date that has
not previously expired or terminated pursuant to its own terms shall be deemed
rejected pursuant to Section 365 of the Bankruptcy Code. The Confirmation Order
shall constitute an order of the Bankruptcy Court approving the rejection of
such executory contracts and unexpired leases, pursuant to Section 365 of the
Bankruptcy Code.
12.02 Proofs of Claim for Rejection of Executory Contracts or Unexpired
Leases
Proofs of Claim for any Claims arising by reason of any rejection of
executory contracts or unexpired leases pursuant to this Plan or pursuant to a
prior order of the Bankruptcy Court shall be filed and served upon the Committee
and counsel for the Committee within thirty (30) days after the Effective Date.
In the event that any such Proof of Claim is not filed and served as set forth
herein, such Claim shall be deemed conclusively to be waived and shall be
forever barred in the Case, without further notice. Claims timely asserted
hereunder arising out of the rejection of executory contracts or unexpired
leases shall be deemed to be Class 2 General Unsecured Claims under this Plan
but shall not automatically become an Allowed Claim.
XIII.
EFFECT OF CONFIRMATION
Confirmation of this Plan, shall have, inter alia, the following effects:
13.01 Vesting of Property
Except as set forth in this Plan to the contrary, on the Effective Date,
the property of the Estate (except only for the rights of the Equity Security
Holders and InfiniCom pursuant to the InfiniCom Stock Agreement) shall vest in
the Committee, as agent for the Debtor and the Estate, free and clear of any
Claims, liens, or interests of Creditors, parties-in-interest, and other
entities.
13.02 Property Free and Clear of Claims
Except as set forth in this Plan to the contrary, all property dealt with
under this Plan shall be distributed free and clear of all Claims, liens, and
interests of Creditors, parties-in-interest, and other entities.
13.03 Binding Effect of Plan
The provisions of this Plan shall be binding upon each Creditor and Equity
Security Holder, whether or not the Claim of such Creditor or Interest of such
Equity Security Holder is impaired under this Plan, and whether or not such
Creditor or Equity Security Holder has accepted this Plan.
13.04 Effect of Section 1141 of the Bankruptcy Code
From and after the Confirmation Date, the Debtor shall be discharged from
any and all debts dischargeable under Section 1141(d) of the Bankruptcy Code,
and confirmation of this Plan, which shall occur on the Confirmation Date, shall
otherwise have all of the effects provided in Section 1141 of the Bankruptcy
Code which are not inconsistent with the terms of this Plan.
13.05 Discharge
Except as set forth in this Plan to the contrary, all debts of the Debtor
that arose at any time before the entry of the Confirmation Order, including,
without limitation, all principal and interest which accrued before the Petition
Date, shall be discharged pursuant to the provisions of Section 1141(d)(1) of
the Bankruptcy Code. The discharge of the Debtor shall be effective as to each
Claim regardless of whether a Proof of Claim respecting that Claim was filed,
whether the Claim was an Allowed Claim, or whether the holder of the Claim
accepted this Plan.
13.06 Injunction
Except as otherwise provided in this Plan or in the Confirmation Order, the
rights afforded in this Plan and the treatment of all Claims in this Plan shall
be in exchange for and in complete satisfaction, discharge, and release of all
Claims (including Administrative Claims and any interest accrued on any Claim
from and after the Petition Date) against the Debtor and any of its assets and
properties. Except as otherwise provided in this Plan or in the Confirmation
Order, on the Confirmation Date, all substantive rights of holders of Claims
shall be terminated, and the Debtor shall be deemed discharged and released to
the fullest extent permitted by Sections 524 and 1141 of the Bankruptcy Code
from all Claims that arose before the Confirmation Date (including any
Administrative Claims and any interest accrued on any Claims from and after the
Petition Date) against the Debtor and any of its assets and properties. All
Creditors shall be precluded from asserting against the Debtor and its assets
and properties, any other or further Claims or Administrative Claims based upon
any act or omission, transaction, or other activity of any kind or nature that
occurred prior to the Confirmation Date, and such discharge shall void any
judgment against the Debtor or the Estate at any time obtained to the extent
that it relates to a Claim or Administrative Claim discharged.
Except as otherwise provided in this Plan or in the Confirmation Order, on
and after the Confirmation Date, all Creditors who have held, currently hold or
who may hold a Claim or Administrative Claim discharged or terminated pursuant
to the terms of this Plan are permanently enjoined from taking any of the
following actions on account of any such discharged Claim or Administrative
Claim: (i) commencing or continuing in any manner any action or other proceeding
against the Debtor, the Estate, the Reorganized Debtor, or their respective
successors, assets, or properties; (ii) enforcing, attaching, collecting, or
recovering in any manner any judgment, award, decree, or order against the
Debtor, the Estate, the Reorganized Debtor, or their respective successors,
assets, or properties; (iii) creating, perfecting, or enforcing any lien or
encumbrance against the Debtor, the Estate, the Reorganized Debtor, or their
respective successors, assets, or properties; (iv) asserting any setoff, right
of subrogation, or recoupment of any kind against any obligation owed to the
Debtor, the Estate, the Reorganized Debtor, or their respective successors,
assets, or properties; and (v) commencing or continuing any action or
proceeding, in any manner, in any place, that does not comply with or is
inconsistent with the provisions of this Plan or the Confirmation Order. Any
entity, including the Debtor, the Committee, or the Reorganized Debtor, injured
by any violation of such injunction shall recover actual damages, including
costs and attorneys' fees and, in appropriate circumstances, may recover
punitive damages, from the violator.
13.07 Liquidating Plan
Notwithstanding the provisions of Paragraph 13.04, 13.05 and 13.06 hereof,
in accordance with the provisions of Section 1141(d)(3) of the Bankruptcy Code,
confirmation of this Plan shall not result in a discharge of the Debtor in the
event that this Plan becomes effective pursuant to the provisions of Paragraph
7.25 of this Plan notwithstanding any termination of the InfiniCom Stock
Agreement.
XIV.
RETENTION OF JURISDICTION
Until this Plan has been fully consummated, the Bankruptcy Court shall
retain jurisdiction for, but not limited to, the following purposes:
14.01 The classification of the Claim of any Claimant and the
re-examination of Claims which have been allowed for the purposes of determining
acceptance of this Plan at the time of the Confirmation Hearing and the
determination of such objections as may be filed to Claims. The failure by the
Debtor or the Committee to object to or to examine any Claim for the purpose of
determining acceptance of this Plan shall not be deemed to be a waiver of the
right of the Debtor or the Committee to object to or to re-examine the Claim in
whole or in part.
14.02 The allowance of any Claim for damages by reason of the rejection of
any executory contract or unexpired lease.
14.03 The determination of all questions and disputes regarding title to
the assets of the Debtor, the Estate, or the Committee, and the determination of
all causes of action, controversies, disputes, or conflicts, whether or not
subject to any action pending as of the Confirmation Date, in which the Debtor
or the Committee is a party, including, but not limited to, any Avoidance
Actions.
14.04 The correction of any defect, the curing of any omission, or the
reconciliation of any inconsistency in this Plan or in the Confirmation Order as
may be necessary to carry out the purposes and intent of this Plan.
14.05 The modification of this Plan after confirmation pursuant to the
Bankruptcy Code and the Bankruptcy Rules, or if in the best interests of the
Estate and the Creditors, modification of this Plan even after this Plan has
been substantially consummated.
14.06 The enforcement and interpretation of the terms and conditions of
this Plan or the Confirmation Order, and the determination of such matters and
the making of such orders consistent with this Plan as may be necessary or
desirable to effectuate the provisions of this Plan.
14.07 The determination, either before or after the closing of the Case, of
any Claims concerning state, local, and federal taxes pursuant to Section 346,
505, 525, or 1146 of the Bankruptcy Code or other applicable law, and the
Debtor's, Reorganized Debtor's, or Estate's entitlement, if any, to tax
attributes which may have been property of the Estate, either before or after
the closing of the Case.
14.08 The shortening or extension, for cause, of the time fixed for doing
any act or thing under this Plan, on such notice, if any, as the Bankruptcy
Court shall determine to be appropriate.
14.09 The entry of any order, including, without limitation, any
injunction, to enforce the title, rights, and powers of the Debtor, Reorganized
Debtor, or the Committee and such limitations, restrictions, terms, and
conditions of such title, rights, and powers as the Bankruptcy Court may deem
necessary.
14.10 The determination of any disputes arising under or relating to any
order entered by the Bankruptcy Court in the Case.
14.11 The entry of any order of the Bankruptcy Court approving the sale,
assignment, transfer, or other disposition of any Retained Assets.
14.12 The allowance of compensation to professionals or other
Administrative Claims.
14.13 The determination of the validity, extent, or priority of any liens
and security interests against property of the Debtor or the Estate.
14.14 The determination of all actions and proceedings which relate to
pre-confirmation matters affecting the Debtor or the Estate whether such action
or proceeding is brought before or after the Effective Date.
14.15 The liquidation or allowance of any Claim.
14.16 The determination of all questions and disputes regarding collection
of assets of the Debtor or the Estate as of the Confirmation Date.
14.17 The entry of an order concluding and terminating the Case.
XV.
DESIGNATION OF THE COMMITTEE AS REPRESENTATIVE OF THE ESTATE
Pursuant to Section 1123(b)(3)(B) of the Bankruptcy Code, the Committee is
hereby designated as the representative of the Estate of the Debtor.
XVI.
PROVISIONS OF THE PLAN WHICH MAY AFFECT,
ALTER, OR MODIFY THE RIGHTS OF CREDITORS
16.01 Fines and Penalties
Except as provided to the contrary in Section 726 of the Bankruptcy Code,
no penalty, fine, exemplary or punitive damage, or other similar charge claimed
by any Claimant shall be compensable by the Debtor or the Estate, or out of
property of the Debtor or the Estate.
16.02 Implementation of Section 1142 of the Bankruptcy Code
Pursuant to Section 1142(a), the Committee is authorized to carry out the
terms of this Plan. All Claimants shall, pursuant to Section 1142(b) of the
Bankruptcy Code, execute and deliver, or join in the execution and delivery of,
any instrument or document appropriate to effectuate this Plan, and perform any
other act that is appropriate for the consummation of this Plan. To the extent
that any Claimant fails to comply with this provision, the Reorganized Debtor,
the Disbursing Agent, or the Committee shall be entitled to obtain, on an
expedited basis, an order from the Bankruptcy Court compelling the Claimant's
compliance with these provisions, and, during the time period encompassed by
such Claimant's non-compliance, no payment shall be made to the non-complying
Claimant under this Plan, and any such non-complying Claimant shall be
responsible for all costs and damages incurred by the Reorganized Debtor, the
Disbursing Agent, or the Committee as a result of such Claimant's non-compliance
with these provisions.
XVII.
RESERVATION OF RIGHTS
Nothing contained in this Plan or in the Disclosure Statement provided
concurrently herewith shall be deemed to be an admission by the Debtor or the
Committee. The Debtor and the Committee reserve any and all rights which they
may have to object to any Claim. The Debtor reserves the right to withdraw this
Plan at any time prior to the Confirmation Date.
XVIII.
MISCELLANEOUS PROVISIONS
18.01 Interpretation, Rules of Construction, Computation of Time, and
Choice of Law
(a) The provisions of this Plan shall control over any description
thereof contained in the Disclosure Statement.
(b) Any term used in this Plan that is not defined in this Plan, but
that is used in the Bankruptcy Code or in the Bankruptcy Rules has the
meaning assigned to that term in (and shall be construed in accordance with
the rules of construction under) the Bankruptcy Code or the Bankruptcy
Rules. Without limiting the foregoing, the rules of construction set forth
in Section 102 of the Bankruptcy Code shall apply hereto. The definitions
and rules of construction contained herein do not apply to the Disclosure
Statement or to the exhibits to this Plan except to the extent expressly so
stated in the Disclosure Statement or in each exhibit to this Plan.
(c) Unless specified otherwise in a particular reference in this Plan,
the words "herein," "hereof," "hereto," and others of similar import refer
to this Plan as a whole and not to any particular paragraph, subparagraph,
or clause contained in this Plan.
(d) Unless specified otherwise in a particular reference in this Plan,
all references in this Plan to paragraphs and exhibits are references to
paragraphs and exhibits of or to this Plan.
(e) Any reference in this Plan to a contract, agreement, instrument,
or other document being in a particular form or on particular terms and
conditions means that such document shall be substantially in such form or
substantially on such terms and conditions.
(f) Any reference in this Plan to an existing document or exhibit
filed or to be filed means such document or exhibit, as it may be amended,
restated, modified, or supplemented as of the Confirmation Date.
(g) Captions and headings to paragraphs in this Plan are inserted for
convenience of reference only and shall neither constitute a part of this
Plan nor in any way affect the interpretation of any provisions hereof.
(h) Whenever from the context it is appropriate, each term stated in
either the singular or the plural shall include both the singular and the
plural.
(i) In computing any period of time prescribed or allowed by this
Plan, the provisions of Rule 9006(a) of the Federal Rules of Bankruptcy
Procedure shall apply.
(j) All exhibits to this Plan are incorporated into this Plan and
shall be deemed to be included in this Plan, regardless of when they are
filed.
(k) Except to the extent that federal law, including the Bankruptcy
Code or Bankruptcy Rules are applicable, the rights and obligations arising
under this Plan shall be governed by, and construed and enforced for all
purposes in accordance with, the laws of the State of California, without
giving effect to any principles of conflict of laws thereof.
(l) All notices, correspondence and other deliveries shall be directed
as follows:
Scoop, Inc.
c/o Robert E. Opera, Esq.
Lobel, Opera & Friedman LLP
19800 MacArthur Blvd., Suite 1100
Irvine, CA 92612
Unsecured Creditors Committee of Scoop, Inc.
c/o Ira D. Kharasch, Esq.
Pachulski, Stang, Ziehl & Young
10100 Santa Monica Blvd., Suite 1100
Los Angeles, CA 90067
18.02 Conditions Precedent to Confirmation and Effective Date
This Plan shall not become effective and the Effective Date shall not occur
unless and until the Confirmation Order shall have been duly entered by the
Bankruptcy Court, no stay of the Confirmation Order shall be in effect, and the
Confirmation Order shall have become a Final Order, unless such condition has
been duly waived in accordance with Paragraph 2.41 hereof. The Confirmation
Order shall be deemed annulled at such time as a condition to the Effective Date
that has not been waived in writing executed by the Debtor (with the consent of
InfiniCom, which consent shall not be unreasonably withheld) can no longer
occur.
18.03 Payment of Statutory Fees
All fees payable pursuant to Section 1930 of Title 28 of the United States
Code, as determined by the Bankruptcy Code at the Confirmation Hearing, shall be
paid on or before the Effective Date. Such fees shall be payable only from funds
of the Estate.
18.04 Successors and Assigns
The rights, benefits, and obligations of any entity named or referred to in
this Plan shall be binding on, and shall inure to the benefit of, the heirs,
executors, administrators, successors, and/or assigns of such entity.
18.05 Further Actions
Nothing contained in this Plan shall be deemed to impair in any manner the
right of any party-in-interest, including, without limitation, the Reorganized
Debtor, the Committee, or the Disbursing Agent, to seek at any time after the
Confirmation Date orders of the Bankruptcy Court approving actions to be taken
consistent with this Plan as may be necessary or desirable to effectuate the
provisions of this Plan.
18.06 Other Documents and Actions
The Debtor, the Reorganized Debtor, the Disbursing Agent, and the Committee
shall have the right to execute such documents and take such other actions as is
appropriate to effectuate the transactions provided for in this Plan.
XIX.
REQUEST FOR CONFIRMATION
The Debtor hereby requests entry of an order confirming this Plan as having
satisfied the requirements of Section 1129 of the Bankruptcy Code. The Debtor
further requests that the Bankruptcy Court make such findings of fact and
conclusions of law as may be necessary to implement this Plan.
DATED: July 23, 1999 Scoop, Inc.
a Delaware corporation
By: /s/ Rand Bleimeister
----------------------
Rand Bleimeister
Its: President and Chief Executive Officer
PRESENTED BY:
LOBEL, OPERA & FRIEDMAN LLP
By: /s/ Robert E. Opera
-------------------
Robert E. Opera
Hamid R. Rafatjoo
Attorneys for Debtor and Debtor-in Possession
APPROVED AS TO FORM AND CONTENT:
WHITE & CASE LLP
By: /s/ Brian L. Holman
-------------------
Brian L. Holman
Daniel H. Peters
Attorneys for InfiniCom AB
- --------------------------------------------------------------------------------
STOCK PURCHASE AGREEMENT
Dated as of April 23, 1999
By and Between
INFINICOM AB (publ)
and
SCOOP, INC.
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS AND INTERPRETATIONS...................................1
1.1 Defined Terms.....................................................1
1.2 Principles of Construction........................................4
SECTION 2. REPRESENTATIONS AND WARRANTIES....................................4
2.1 Representations and Warranties of InfiniCom.......................4
2.2 Representations and Warranties Regarding Financial Projections....5
2.3 Continuing Duty to Inform.........................................5
SECTION 3. THE TRANSACTION ..................................................6
3.1 Shortfall Payment.................................................6
3.2 Transfer and Payment..............................................7
3.3 Closing...........................................................7
SECTION 4. CONDITIONS PRECEDENT .............................................7
4.1 Scoops Conditions.................................................7
4.2 InfiniComs Conditions.............................................8
SECTION 5. TERMINATION.......................................................9
5.1 Events of Termination.............................................9
5.2 Effect of Termination.............................................9
SECTION 6. SURVIVAL OF REPRESENTATIONS; COVENANTS............................9
6.1 Survival of Representations.......................................9
6.2 Bankruptcy Proceedings............................................9
6.3 Further Assurances...............................................10
6.4 InfiniComs Covenants Regarding Bankruptcy Proceedings............10
6.5 Scoop, Inc. Name.................................................10
SECTION 7. MISCELLANEOUS....................................................11
7.1 Expenses.........................................................11
7.2 Governing Law....................................................12
7.3 Disclosure.......................................................12
7.4 Notices..........................................................12
7.5 Parties in Interest..............................................14
7.6 Tax Consequences.................................................14
7.7 Counterparts.....................................................14
7.8 Entire Agreement.................................................14
7.9 Amendments.......................................................14
7.10 Severability....................................................14
7.11 Third Party Beneficiaries.......................................14
7.12 Attorneys' Fees.................................................14
<PAGE>
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of April 23, 1999, is
entered into by and between INFINICOM AB (publ), a holding company formed under
the laws of Sweden ("InfiniCom"), and SCOOP, INC., a corporation organized and
existing under the laws of the State of Delaware ("Scoop").
W I T N E S S E T H :
WHEREAS, on July 31, 1998, Scoop filed a voluntary petition commencing a
case under Chapter 11 of the United States Bankruptcy Code (the "Code") (the
"Bankruptcy Proceeding") in the United States Bankruptcy Court for the Central
District of California (the "Bankruptcy Court");
WHEREAS, as part of a plan of reorganization (the "Plan") to be filed by
Scoop in the Bankruptcy Proceeding, InfiniCom desires to purchase, and Scoop
desires to sell to InfiniCom, 61.6 million shares, or such other number of
shares (the "Acquired Shares"), of Scoop's common stock ("Scoop Stock"), which
upon issuance and payment therefor shall represent ninety-one percent (91%) of
the issued and outstanding Scoop Stock;
WHEREAS, InfiniCom owns 100% of the issued and outstanding shares of
capital stock (the "24STORE Stock") of 24STORE.com Limited, a company
incorporated under the laws of England and Wales with company number 3605559
(the "Company");
WHEREAS, as a part of the Plan, and as consideration for the purchase of
the Acquired Shares, InfiniCom desires to transfer and deliver to Scoop the
24STORE Stock (the "24STORE Sale"); and
WHEREAS, it is the intention of InfiniCom and Scoop that upon consummation
of the foregoing transactions (collectively, the "Transaction"), InfiniCom shall
own 91% of the issued and outstanding Scoop Stock and Scoop shall own 100% of
the 24STORE Stock;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants, representations, warranties and agreements herein contained, the
Parties agree as follows:
SECTION 1. DEFINITIONS AND INTERPRETATIONS
1.1 Defined Terms. In this Agreement the following words and expressions
shall have the following meanings (such meaning to be equally applicable to both
the singular and plural forms of the terms defined):
"Acquired Shares" shall have the meaning provided in the recitals;
"Agreement" shall have the meaning provided in the introductory paragraph;
"Allowed Claims" shall have the meaning provided in the Plan;
"Applicable Interest Period" shall have the meaning provided in Section
3.1;
"Bankruptcy Costs" means costs and expenses associated with (i) the
negotiating, drafting, and filing of the Plan and all amendments thereto as may
be deemed necessary by Scoop's bankruptcy counsel and special Transaction
counsel and counsel for the Creditors' Committee (collectively, the "Estate's
Professionals"), (ii) the drafting and filing of the Disclosure Statement filed
in connection with the filing of the Plan and all amendments thereto as may be
deemed necessary the Estate's Professionals, (iii) the filing, preparing, and
drafting of such other documents and pleadings as may be deemed necessary by the
Estate's Professionals in connection with the negotiating, drafting, and filing
of the Plan and the confirmation process, (iv) the performing of such other
tasks as may be deemed necessary by the Estate's Professionals in connection
with the confirmation process including, but not limited to, attending hearings
in connection with the activities referenced in clauses (i) to (iii) above, the
preparation of ballots, the counting of the ballots, and the preparation of
exhibits to the Disclosure Statement and the Plan, and (v) the negotiation,
preparation and documentation of this Agreement and the other documents
described herein;
"Bankruptcy Court" shall have the meaning provided in the recitals;
"Bankruptcy Court Order" shall have the meaning provided in Section 2.1(d);
"Bankruptcy Proceeding" shall have the meaning provided in the recitals;
"Cash" shall have the meaning provided in the Plan;
"Closing Date" shall have the meaning provided in Section 3.3;
"Company" shall have the meaning provided in the recitals;
"Creditors' Committee" shall mean the Official Committee of Creditors
Holding Unsecured Claims appointed in connection with the Bankruptcy Proceeding;
"Disbursing Agent" shall have the meaning provided in the Plan;
"Effective Date" shall have the meaning provided in the Plan;
"Eligible Claims" shall mean all allowed general unsecured claims, together
with interest thereon from July 31, 1998 through and including the Effective
Date, at the rate of ten percent (10%) per annum;
"Escrow Account" shall have the meaning provided in Section 3.1;
"Escrow Holder" shall have the meaning provided in Section 3.1;
"Estate" shall have the meaning provided in the Plan;
"InfiniCom" shall have the meaning provided in the introductory paragraph
hereto;
"Investment Earnings" shall have the meaning provided in Section 3.1;
"Material Adverse Effect" means (a) with respect to any Person, a material
adverse effect on (i) the validity or enforceability of this Agreement against
such Person or (ii) the ability of such Person to perform its obligations under
this Agreement or (b) in the case of InfiniCom, a material adverse effect on the
business, assets, conditions or results of operations of InfiniCom and its
subsidiaries, taken as a whole;
"Party" or "Parties" means InfiniCom or Scoop, or both of them, as the case
may be;
"Person" shall mean and include any individual, partnership, joint venture,
association, joint stock company, corporation, trust, limited liability company,
unincorporated organization, a group and a government or other department,
agency or political subdivision thereof;
"Plan" shall have the meaning provided in the recitals;
"Principal Deposit" shall have the meaning provided in Section 3.1;
"Scoop" shall have the meaning provided in the introductory paragraph
hereto;
"Scoop Stock" shall have the meaning provided in the recitals;
"Shortfall Amount" shall have the meaning provided in Section 3.1;
"Shortfall Deposit" shall have the meaning provided in Section 3.1;
"Shortfall Excess" shall have the meaning provided in Section 3.1;
"Shortfall Interest Amount" shall have the meaning provided in Section 3.1;
"Shortfall Payment" shall have the meaning provided in Section 3.1;
"Shortfall Principal Amount" shall have the meaning provided in Section
3.1;
"Transaction" shall have the meaning provided in the recitals;
"Transaction Costs" shall have the meaning provided in Section 7.1(a);
"24STORE Sale" shall have the meaning provided in the recitals; and
"24STORE Stock" shall have the meaning provided in the recitals.
1.2 Principles of Construction.
(a) All references to Articles, Sections, subsections and Exhibits are to
Articles, Sections, subsections and Exhibits in or to this Agreement unless
otherwise specified. The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement. The term
"including" is not limiting and means "including without limitation."
(b) In the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including"; the words "to" and
"until" each mean "to but excluding"; and the word "through" means "to and
including."
(c) The Table of Contents hereto and the Section headings herein are for
convenience only and shall not affect the construction hereof.
(d) This Agreement is the result of negotiations among and has been
reviewed by each Party's counsel. Accordingly, this Agreement shall not be
construed against any Party merely because of such Party's involvement in its
preparation.
(e) Wherever in this Agreement the intent so requires, reference to the
neuter, masculine or feminine shall be deemed to include each of the other, and
reference to either the singular or the plural shall be deemed to include the
other.
SECTION 2. REPRESENTATIONS AND WARRANTIES
2.1 Representations and Warranties of InfiniCom. InfiniCom represents and
warrants to and agrees with Scoop as follows:
(a) Ownership of the 24STORE Stock. It is the lawful owner of the 24STORE
Stock, free and clear of all liens, encumbrances, restrictions and claims of
every kind. The delivery to Scoop of the certificates evidencing the 24STORE
Stock together with a stock power in blank executed by InfiniCom pursuant to the
provisions of this Agreement will transfer to Scoop good and marketable title
thereto, free and clear of all liens, encumbrances restrictions and claims of
every kind.
(b) Existence and Good Standing; Power and Authority. It is duly organized,
validly existing and in good standing under the laws of Sweden. It has the power
and authority to enter into, execute and deliver this Agreement and to perform
its obligations hereunder. This Agreement has been duly authorized and approved
by all of its required corporate action and constitutes its legally valid and
binding obligation and is enforceable against it in accordance with its terms
except as such enforceability may be limited by bankruptcy, insolvency or
similar laws and equitable principles relating to or affecting the rights of
creditors generally from time to time in effect.
(c) Existence and Good Standing of the Company. The Company is a company
duly organized and validly existing under the laws of England and Wales.
(d) Consents and Approvals; No Violations. The consummation of the
Transaction by it and the Company will not (a) violate any provision of its or
the Company's charter documents, (b) violate any statute, ordinance, rule,
regulation, order or decree of any court or any governmental or regulatory body,
agency or authority applicable to it or the Company or (c) require any filing
with, or permit, consent or approval of, or the giving of any notice to, any
governmental or regulatory body, agency or authority, except for an order of the
Bankruptcy Court approving the Transaction pursuant to the Plan (the "Bankruptcy
Court Order") and for those filings, notices, permits, consents and approvals
the absence of which, in the aggregate, would not have a Material Adverse Effect
on it or the Company.
(e) Purchase for Investment. It is acquiring the Acquired Shares for its
own account for investment and not with a view toward any resale or distribution
thereof; provided, however, that the disposition of its property shall at all
times remain within its sole control.
(f) Broker's or Finder's Fees. No agent, broker, person or firm acting on
behalf of InfiniCom, the Company, or any of their affiliates is, or will be,
entitled to any commission or broker's or finder's fees from Scoop or any of its
shareholders, officers, directors, employees, or affiliates, in connection with
any of the transactions contemplated by this Agreement.
2.2 Representations and Warranties Regarding Financial Projections.
InfiniCom represents and warrants to and agrees with Scoop that all financial
and other information which InfiniCom or the Company furnished or will furnish
to Scoop regarding InfiniCom and/or the Company for inclusion in the Plan, in
the disclosure statement accompanying the Plan or in any pleadings filed in the
Bankruptcy Proceeding in connection with the approval of the disclosure
statement or the confirmation of the Plan (a) is true, accurate and complete as
of its date in all material respects except to the extent such information is
superseded by information marked as such, (b) does not omit any material fact
necessary in order to make the statements of material fact contained therein, in
the light of the circumstances under which they were made, not misleading and
(c) (with respect to historical financial information only) presents fairly the
financial condition of the organization covered thereby as of the dates and for
the period covered thereby.
Any written projections given to Scoop by or on behalf of InfiniCom and/or
the Company have been prepared using assumptions which InfiniCom believes were
reasonable at the date on which such projections were made.
2.3 Continuing Duty to Inform. Until the Closing Date or the earlier
termination of this Agreement pursuant to Section 5.1, InfiniCom shall inform
Scoop in writing within seven (7) days of discovering such facts and
circumstances as would render any information, financial or otherwise, provided
pursuant to Section 2.1 or 2.2 false, incomplete, misleading, or otherwise
unreliable, in each case in any material respect.
SECTION 3. THE TRANSACTION
3.1 Shortfall Payment. On or before the date on which the Plan is filed
with the Bankruptcy Court, InfiniCom shall deposit the sum of $225,000 (the
"Shortfall Principal Deposit") into an escrow account (the "Escrow Account")
with an escrow company (which may be a bank or trust company) mutually
acceptable to InfiniCom and Scoop (the "Escrow Holder"). The Escrow Holder shall
be instructed to invest all amounts from time to time on deposit in the Escrow
Account in such securities as InfiniCom and Scoop shall mutually agree. All
investment earnings from such investments ("Investment Earnings") shall be
credited to the Escrow Account. On or before the fifth (5th) day of each month
after the date on which the Plan is filed with the Bankruptcy Court, InfiniCom
shall deposit with the Escrow Holder for deposit into the Escrow Account an
amount (the "Shortfall Interest Amount"; the Shortfall Principal Deposit
together with all Shortfall Interest Amounts and, to the extent not included in
a Shortfall Interest Amount, all Investment Earnings, collectively, the
"Shortfall Deposit") equal to the difference between (a) the product of (i)
$22,500 and (ii) a fraction, the numerator of which is the number of days in the
calendar month preceding the payment date or, in the case of the first such
payment, from and including April 1, 1999 through but excluding the payment date
(each such period, an "Applicable Interest Period"), and the denominator of
which shall be three hundred sixty five (365) and (b) the Investment Earnings,
if any, for the Applicable Interest Period. Subject to the terms and conditions
set forth in this Agreement, to the extent that the Estate of Scoop on the
Effective Date has insufficient funds available to pay in full the allowed
amount of all Eligible Claims (the amount of such insufficiency shall be
referred to as the "Shortfall Amount"), InfiniCom and Scoop shall cause the
Escrow Holder to pay to the Disbursing Agent from the Shortfall Deposit in the
Escrow Account on the Closing Date for distribution to the holders of Eligible
Claims in accordance with the Plan an amount (collectively, the "Shortfall
Payment") equal to (x) the lesser of the Shortfall Amount or the Shortfall
Principal Deposit (such lesser amount, the "Shortfall Principal Amount") plus
(y) simple interest on the Shortfall Principal Amount at the rate of 10% per
annum (based on a year of 365 days and actual days elapsed) from and including
April 1, 1999 to but excluding the earlier of August 31, 1999 or the date on
which the Plan is confirmed. The Shortfall Deposit is non-refundable to the
extent necessary to pay the Shortfall Payment, and the only grounds under which
InfiniCom shall be entitled to obtain a refund of the Shortfall Deposit are if
this Agreement is terminated under Section 5.1(a), (b) or (d); provided,
however, that InfiniCom shall be entitled to the refund of any Shortfall Deposit
remaining in the Escrow Account after the Shortfall Payment is made to the
Disbursing Agent (such remaining amount, the "Shortfall Excess"). The Shortfall
Excess, if any, may be repaid to InfiniCom in increments, or as a whole, as
distributions are made to holders of Eligible Claims; provided, however, that
the full amount of any Shortfall Excess shall have been paid to InfiniCom on or
before the earlier of (A) the date numerically corresponding to the Effective
Date in the twelfth month after the Effective Date or (B) the business day
immediately following the first date on which all Eligible Claims shall have
been paid. The Shortfall Deposit shall be subject to the jurisdiction of the
Bankruptcy Court, and in the event that any dispute should arise among Scoop,
InfiniCom and the Creditors' Committee regarding the disposition of the
Shortfall Deposit, the Bankruptcy Court will determine the merits of such
dispute.
3.2 Transfer and Payment. Subject to the terms and conditions set forth in
this Agreement, on the Closing Date, (i) Scoop shall assign, transfer and
deliver to InfiniCom the certificates representing the Acquired Shares,
registered in the name of InfiniCom and/or its nominees, (ii) InfiniCom shall
assign, transfer and deliver to Scoop the certificate representing the 24STORE
Stock, together with a stock power in blank executed by InfiniCom, (iii)
InfiniCom and Scoop shall instruct the Escrow Holder to pay to the Disbursing
Agent the Shortfall Payment in accordance with Section 3.1 and (iv) InfiniCom
and Scoop shall instruct the Escrow Holder to pay to InfiniCom the Shortfall
Excess, if any, in accordance with Section 3.1 (collectively, the "Closing").
3.3 Closing. The Closing shall take place at 10:00 A.M. at the offices of
White & Case LLP at 633 West Fifth Street, Suite 1900, Los Angeles, California
on the later of (a) the Effective Date or (b) the first date on which the
conditions precedent set forth in Section 4 shall have been satisfied or waived
(the "Closing Date").
SECTION 4. CONDITIONS PRECEDENT
4.1 Scoop's Conditions. The obligations of Scoop to (x) deliver the
certificates representing the Acquired Shares pursuant to clause (i) of Section
3.2 and (y) instruct the Escrow Holder to pay the Shortfall Excess, if any, to
InfiniCom pursuant to clause (iv) of Section 3.2 is subject to the satisfaction
or waiver (subject to applicable law) at or prior to the Closing Date of each of
the following conditions:
(a) Injunction. No preliminary or permanent injunction or other order
shall have been issued by any court or by any governmental or regulatory
agency, body or authority which prohibits the consummation of the
Transaction and the other transactions contemplated by this Agreement and
which is in effect at the Closing Date;
(b) No Litigation. As of the Closing Date, no action or proceedings
(other than an appeal taken from a confirmation order of the Bankruptcy
Court with respect to the Plan) shall have been instituted and remain
pending before a court or other government body or by any public authority
to restrain or prohibit the consummation of the Transaction and the other
transactions contemplated by this Agreement;
(c) Truth of Representations and Warranties. The representations and
warranties of InfiniCom contained herein shall be true and accurate in all
material respects at and as of the date of this Agreement and as of the
Closing Date (except to the extent a representation or warranty speaks
specifically as of an earlier date or as contemplated in this Agreement);
(d) Reorganization Plan. (i) The consummation of the Transaction and
the other transactions contemplated by this Agreement shall have been
provided for as part of the Plan, (ii) the Plan shall have been approved
and confirmed by the Bankruptcy Court Order and (iii) the Effective Date
shall have occurred and upon the Effective Date of the Plan, Scoop shall
have been fully discharged from all claims of Scoop's creditors and
shareholders, including all unliquidated and contingent claims, all
administrative claims relating to the Bankruptcy Proceeding, and all other
post-petition liabilities of Scoop, other than obligations to InfiniCom
under this Agreement and equity interests of Scoop's shareholders retained
under the Plan pursuant to this Agreement;
(e) Delivery of 24STORE Stock. Each of the certificates representing
the 24STORE Stock shall have been delivered by InfiniCom to Scoop in
accordance with the provisions of Section 3.2;
(f) Payment of the Shortfall Payment. InfiniCom shall have instructed
the Escrow Holder to pay to the Disbursing Agent the Shortfall Payment in
accordance with the provisions of Section 3.1; and
(g) Payment of the Transaction Costs. InfiniCom shall have paid the
Transaction Costs in accordance with the provisions of Section 7.1.
4.2 InfiniCom's Conditions. The obligations of InfiniCom to (x) deliver the
certificate representing the 24STORE Stock pursuant to clause (ii) of Section
3.2 and (y) instruct the Escrow Holder to pay the Shortfall Payment to the
Disbursing Agent pursuant to clause (iii) of Section 3.2 is subject to the
satisfaction or waiver (subject to applicable law) at or prior to the Closing
Date of each of the following conditions:
(a) Acquired Shares. Each of the certificates representing the
Acquired Shares shall have been delivered by Scoop to InfiniCom.
(b) Injunction. No preliminary or permanent injunction or other order
shall have been issued by any court or by any governmental or regulatory
agency, body or authority which prohibits the consummation of the
Transaction and the other transactions contemplated by this Agreement and
which is in effect at the Closing Date;
(c) No Litigation. As of the Closing Date, no action or proceedings
(other than an appeal taken from a confirmation order of the Bankruptcy
Court with respect to the Plan) shall have been instituted and remain
pending before a court or other government body or by any public authority
to restrain or prohibit the consummation of the Transaction and the other
transactions contemplated by this Agreement; and
(d) Reorganization Plan. (i) The consummation of the Transaction and
the other transactions contemplated by this Agreement shall have been
provided for as part of the Plan, (ii) the Plan shall have been approved
and confirmed by the Bankruptcy Court Order and (iii) the Effective Date
shall have occurred and upon the Effective Date of the Plan, Scoop shall
have been fully discharged from all claims of Scoop's creditors and
shareholders, including all unliquidated and contingent claims, all
administrative claims relating to the Bankruptcy Proceeding, and all other
post-petition liabilities of Scoop, other than obligations to InfiniCom
under this Agreement and equity interests of Scoop's shareholders retained
under the Plan pursuant to this Agreement.
SECTION 5. TERMINATION
5.1 Events of Termination. This Agreement may be terminated (a) at any time
by mutual written agreement of the Parties; (b) in whole and not in part by
InfiniCom by written notice to Scoop, if (i) the conditions set forth in Section
4.2 hereof shall not have been complied with or performed on or prior to
September 30, 1999 (or such later date as the Parties may have agreed to in
writing) in any material respect and InfiniCom shall not have materially
breached any of its representations, warranties, covenants or agreements
contained herein; (c) in whole and not in part by Scoop by written notice to
InfiniCom, if (i) the conditions set forth in Section 4.1 hereof shall not have
been complied with or performed on or prior to September 30, 1999 (or such later
date as the Parties may have agreed to in writing) in any material respect and
Scoop shall not have materially breached any of its covenants or agreements
contained herein, (ii) InfiniCom fails to make any payment of Transaction Costs
within fifteen (15) days after notice in writing is given by Scoop that such
payment has not been made when due and payable or (iii) InfiniCom fails to pay
the Shortfall Payment in accordance with this Agreement within fifteen days
after notice in writing is given by Scoop that such payment has not been made
when due and payable; or (d) by either of the Parties if the Bankruptcy Court
shall have entered an order denying approval of this Agreement or approving any
other transaction that would be inconsistent with the spirit or intent of this
Agreement.
5.2 Effect of Termination. In the event that this Agreement shall be
terminated pursuant to Section 5.1, all further obligations of the Parties
hereto under this Agreement (other than pursuant to Sections 7.1 (Expenses) and
7.3 (Disclosure) which shall continue in full force and effect) shall terminate
without further liability or obligation of any Party to any other Party
hereunder; provided, however, that no Party shall be released from liability
hereunder if this Agreement is terminated and the Transaction is abandoned by
reason of (a) failure of such Party to have performed its material obligations
hereunder and (b) any knowing misrepresentation made by such Party of any matter
set forth herein.
SECTION 6. SURVIVAL OF REPRESENTATIONS; COVENANTS
6.1 Survival of Representations. The representations and warranties of
InfiniCom contained in Sections 2.1 and 2.2 are made only as of (a) the date of
this Agreement and (b) the Closing Date. Except with respect to the
representations and warranties made in Section 2.1(a), the representations and
warranties contained in Section 2.1 and 2.2 shall expire for all purposes at
11:59 P.M., California Time, on the Closing Date. The representations and
warranties made in Section 2.1(a) shall survive the Closing Date but shall
expire for all purposes at 11:59 P.M., California Time, on the date numerically
corresponding to the Closing Date in the twenty-fourth month after the Closing
Date.
6.2 Bankruptcy Proceedings. Scoop shall:
(a) use commercially reasonable efforts to obtain confirmation of the
Plan by the Bankruptcy Court as soon as reasonably possible; and
(b) not take any action in connection with the Bankruptcy Proceeding
or otherwise that would knowingly restrict or prohibit Scoop's ability to
consummate, pursuant to the Plan, the Transaction and the other
transactions contemplated by this Agreement or that would otherwise be
inconsistent with the spirit or intent of this Agreement.
6.3 Further Assurances. Until the Closing Date or earlier termination of
this Agreement pursuant to Section 5.1:
(a) Securities Act Compliance. Scoop shall continue to make all
filings required to be made by a reporting company under the Securities
Exchange Act of 1934, as amended; provided, however, that Scoop shall
continue its practice of filing current reports on Form 8-K containing
Scoop's monthly operating reports filed with the Bankruptcy Court in lieu
of filing Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K;
(b) Claims. Scoop shall promptly inform InfiniCom of all material
claims, other than those claims listed on the Bankruptcy Court's claims
register as of the date of this Agreement, made by creditors or
shareholders of Scoop which may be subject to objection by Scoop or the
Creditors' Committee;
(c) Access. Scoop will afford InfiniCom full and free access to Scoop,
its personnel, properties, contracts, books and records, and all other
documents and data; and
(d) Exclusive Dealing. Until any termination of this Agreement in
accordance with the terms hereof, Scoop (i) will not, directly or
indirectly, through any representative or otherwise, solicit offers from
any other person relating to the acquisition of Scoop, its stock, assets or
business, in whole or in part, whether directly or indirectly, through
purchase, merger, consolidation, reverse acquisition or otherwise and (ii)
will promptly notify InfiniCom regarding any contact between Scoop or its
representatives and any other person regarding any such offer or proposal
or any related inquiry.
6.4 InfiniCom's Covenants Regarding Bankruptcy Proceedings. InfiniCom shall
use commercially reasonable efforts to cooperate fully and completely with Scoop
and Scoop's counsel in Scoop's efforts to obtain confirmation of the Plan,
including by providing to Scoop financial and other information regarding
InfiniCom and the Company reasonably requested by Scoop for the purpose of
Scoop's preparation of the Plan and the disclosure statement accompanying the
Plan. Without limiting the generality of the foregoing, InfiniCom shall be
solely responsible for drafting all provisions of the Plan and disclosure
statement relating to securities and corporate issues in connection with the
implementation of the Transaction.
6.5 "Scoop, Inc." Name. InfiniCom expressly agrees that this Agreement does
not affect the rights of the Estate of Scoop in the name "Scoop, Inc." and that
the Estate of Scoop shall retain the name "Scoop, Inc.", and any derivative
thereof, and all goodwill, trademarks and general intangibles associated with
the name "Scoop, Inc." and Scoop's business operations prior to the Effective
Date. InfiniCom acknowledges and agrees that Scoop may sell the name "Scoop,
Inc." on or before the Effective Date and that, on and after the Effective Date,
the name "Scoop, Inc." shall no longer be the name of Scoop.
SECTION 7. MISCELLANEOUS
7.1 Expenses.
(a) Each of the Parties shall bear its own expenses in connection with the
transactions contemplated by this Agreement, except that InfiniCom shall pay
Scoop for reasonable and documented costs and expenses incurred by the
bankruptcy estate of Scoop, including, without limitation, (i) attorneys' fees
and costs (including the Bankruptcy Costs and the Committee's fees and costs),
(ii) accountants' fees and costs, and (iii) consulting fees and costs charged by
Rand Bleimeister and Kristy Allan in connection with the negotiation of the
terms of this Agreement and the pursuit, approval, and consummation of the
transactions contemplated hereby ("Transaction Costs").
(b) The total amount of InfiniCom's liability for payment of Transaction
Costs pursuant to Section 7(a) shall not exceed $125,000. InfiniCom has
previously paid to Scoop $50,000 in respect of Transaction Costs and InfiniCom
shall pay an additional $75,000 in respect of Transaction Costs to Scoop as
follows: (i) $35,000 within five (5) business days following (A) approval by the
Creditors' Committee of the Transaction, (B) approval by the Bankruptcy Court of
the Disclosure Statement and (C) presentation by Scoop to InfiniCom of an
accounting of Transaction Costs incurred to such date and written estimates of
further Transaction Costs required to obtain confirmation of the Plan and (ii)
$40,000 five (5) business days prior to the hearing on the confirmation of the
Plan. The Transaction Costs paid to Scoop in accordance herewith shall be fully
non-refundable upon payment, except as provided in clause (c) of this Section
7.1. If InfiniCom does not timely make the last payment in respect of
Transaction Costs, Scoop shall have the right to continue the confirmation
hearing on the Plan (even beyond September 30, 1999) and shall be able to
withdraw $40,000 from the $225,000 payment referenced in Section 3.1.
(c) The Transaction Costs shall be deemed reasonable by InfiniCom if the
Bankruptcy Court determines, after hearing, that such fees and costs are
reasonable in accordance with the provisions of Sections 330 or 331 of the Code.
With respect to fees and costs incurred by Scoop's insiders (i.e., Rand
Bleimeister and Kristy Allan), such fees and costs shall be deemed reasonable if
the Creditors' Committee and InfiniCom jointly deem such fees to be reasonable.
InfiniCom hereby waives its rights to contest the reasonableness of the
Transaction Costs or to file objections, responses, comments, declarations, or
other documents in opposition to any fee application filed by any professional
employed in Scoop's case or in conflict with the fees and costs requested in the
fee application, except as provided in the preceding sentence with respect to
the fees and costs of Scoop's insiders. Within thirty (30) days of the earlier
of the Closing Date or termination of this Agreement in accordance with Section
5.1, Scoop shall repay to InfiniCom any amounts paid to Scoop pursuant to this
Section 7.1 in excess of Transaction Costs incurred to such earlier date;
provided that Scoop shall be entitled to retain funds sufficient to pay all fees
and costs of professionals employed in the Bankruptcy Proceeding pending the
entry of Bankruptcy Court orders relative to final fee applications filed in the
Bankruptcy Proceeding by such professionals.
7.2 Governing Law. THE INTERPRETATION AND CONSTRUCTION OF THIS AGREEMENT,
AND ALL MATTERS RELATING HERETO, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
CALIFORNIA APPLICABLE TO AGREEMENTS EXECUTED AND TO BE PERFORMED SOLELY WITHIN
SUCH STATE.
7.3 Disclosure. Each of the Parties agrees that it will not make any public
comments, statements, or communications with respect to, or otherwise disclose,
the execution of this letter or the terms and conditions of the transactions
contemplated by this Agreement without the prior written consent of the other
party, which consent shall not be unreasonably withheld, unless (i) such
disclosure is expressly contemplated by the terms of this Agreement or is
necessary to obtain Bankruptcy Court approval of the disclosure statement
accompanying the Plan or confirmation of the Plan or (ii) in the good faith
opinion of counsel, such disclosure is required by law and time does not permit
the obtaining of such consent.
7.4 Notices. Any notice or other communication required or permitted under
this Agreement shall be sufficiently given if delivered in person or sent by
facsimile or by registered or certified mail, postage prepaid, addressed as
follows:
if to InfiniCom, to:
InfiniCom AB (publ)
Gustavlundsvagen 151 A
S-167 51 Bromma
Sweden
Telephone: +46 8 634 15 70
Facsimile: +46 8 634 15 78
Attention: Karl-Magnus Karlsson
with a copy to:
White & Case Advokat AB
Nybrogatan 3
Box 5573
S-114 85 Stockholm
Sweden
Telephone: +46 8 679 80 30
Facsimile: +46 8 611 21 22
Attention: Clas Romander
with a copy to:
White & Case LLP
633 West Fifth Street, Suite 1900
Los Angeles, California 90071
Telephone: 213-620-7700
Facsimile: 213-687-0758
Attention: Neil W. Rust
if to Scoop, to:
Scoop, Inc.
1800 Century Park East
Los Angeles, California 90067
Telephone: 310-
Facsimile: 310-229-5919
Attention: Rand Bleimeister
with a copy to:
Latham & Watkins
650 Town Center Drive, Suite 2000
Costa Mesa, California 92626-1918
Telephone: 714-540-1235
Facsimile: 714-755-8290
Attention: William J. Cernius
with a copy to:
Lobel, Opera & Friedman LLP
19800 MacArthur Boulevard, Suite 1100
Irvine, California 92612-2425
Telephone: 949-476-7400
Facsimile: 949-476-7474
Attention: Robert E. Opera
with a copy to:
Pachulski, Stang, Ziehl & Young
10100 Santa Monica Boulevard, Suite 1100
Los Angeles, California 90067
Telephone: 310-277-6910
Facsimile: 310-201-0760
Attention: Ira D. Kharasch
or such other address or number as shall be furnished in writing by any such
Party, and such notice or communication shall, if properly addressed, be deemed
to have been given as of the date so delivered, sent by facsimile or five (5)
business days after deposit into the U.S. mail, postage prepaid.
7.5 Parties in Interest. This Agreement may not be transferred, assigned,
pledged or hypothecated by any Party hereto, other than by operation of law.
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective heirs, executors, administrators, successors
and permitted assigns.
7.6 Tax Consequences. InfiniCom expressly agrees that it shall pay any
taxes, duties or tariffs imposed by any taxing or governmental authority on the
Estate as a result of the Transaction. Furthermore, the Shortfall Payment and
the Transaction Costs shall be paid to the Disbursing Agent or Scoop, as the
case may be, net of any and all taxes, duties or tariffs imposed by any taxing
or governmental authority. InfiniCom shall not be responsible for, and shall not
be required to pay, any taxes, duties or tariffs imposed by any taxing or
governmental authority on any Person (other than the Estate) as a result of the
Transaction.
7.7 Counterparts. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one instrument.
7.8 Entire Agreement. This Agreement and the other documents referred to
herein contain the entire understanding of the parties hereto with respect to
the subject matter contained herein. This Agreement shall supersede all prior
agreements and understandings between the parties with respect to the
transactions contemplated herein.
7.9 Amendments. This Agreement may not be amended or modified orally, but
only by an agreement in writing signed by Scoop and InfiniCom.
7.10 Severability. In case any provision in this Agreement shall be held
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof will not in any way be affected or impaired
thereby.
7.11 Third Party Beneficiaries. Each Party hereto intends that this
Agreement shall not benefit or create any right or cause of action in or on
behalf of any Person other than the Parties hereto, the Creditors' Committee and
the Estate's Professionals.
7.12 Attorneys' Fees. In the event that any party institutes any action or
proceeding in connection with the enforcement or interpretation of this
Agreement, or for damages by reason of any alleged breach of this Agreement or
any provision hereof, or for a declaration of rights in connection with this
Agreement, or for any other relief, including equitable relief, in connection
with this Agreement, the prevailing party in any such action or proceeding shall
be entitled to receive from the non-prevailing party all of its costs and
expenses in such action or proceeding including, without limitation, attorneys'
fees and costs.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused its corporate
name to be hereunto subscribed by its officer(s) thereunto duly authorized as of
the day and year first above written.
SCOOP, INC.
By: /s/ Rand Bleimeister
---------------------------
Name: Rand Bleimeister
Title: President and Chief
Executive Officer
INFINICOM AB (publ)
By: /s/ Karl-Magnus Karlsson
---------------------------
Name: Karl-Magnus Karlsson
Title: Director
By: /s/ Larsake Sandin
---------------------------
Name: Larsake Sandin
Title: Director
- --------------------------------------------------------------------------------
AGREEMENT
Dated as of November 1, 1999
By and Between
INFINICOM AB (publ)
and
SCOOP, INC.
- --------------------------------------------------------------------------------
<PAGE>
AGREEMENT
AGREEMENT (this "Agreement"), dated as of November 1, 1999, is entered into
by and between INFINICOM AB (publ), a holding company formed under the laws of
Sweden ("InfiniCom"), and SCOOP, INC., a corporation organized and existing
under the laws of the State of Delaware ("Scoop").
W I T N E S S E T H :
WHEREAS, on July 31, 1998, Scoop filed a voluntary petition commencing a
case under Chapter 11 of the United States Bankruptcy Code (the "Bankruptcy
Proceeding") in the United States Bankruptcy Court for the Central District of
California (the "Bankruptcy Court");
WHEREAS, in connection with the plan of reorganization (the "Plan") filed
by Scoop in the Bankruptcy Proceeding, InfiniCom and Scoop entered into a Stock
Purchase Agreement ("Stock Purchase Agreement") dated as of April 23, 1999
wherein Scoop agreed to sell to InfiniCom, 61.6 million shares, or such other
number of shares (the "Acquired Shares") of Scoop's common stock ("Scoop Stock")
which upon issuance and payment therefor would represent ninety-one percent
(91%) of the issued and outstanding Scoop Stock, in consideration of InfiniCom's
transfer and delivery to Scoop of 100% of the issued and outstanding shares of
capital stock (the "24STORE Stock") of 24STORE.com Limited, a company
incorporated under the laws of England and Wales with company number 3605559;
WHEREAS, the Bankruptcy Court has entered its order confirming the Plan;
WHEREAS, Scoop has met all conditions on its part to be satisfied prior to
the closing of the Stock Purchase Agreement;
WHEREAS, InfiniCom represents that it presently is able to transfer and
deliver to Scoop only 95% of the 24STORE Stock free and clear of liens,
encumbrances, restrictions and claims;
WHEREAS, the parties desire to close the Stock Purchase Agreement subject
to the provisions of this Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants, representations, warranties and agreements herein contained, the
Parties agree as follows:
SECTION 1. DEFINITIONS AND INTERPRETATIONS
1.1 Defined Terms. Capitalized terms used in this Agreement and not
otherwise defined herein shall have the meanings specified for such terms in the
Stock Purchase Agreement.
1.2 Principles of Construction.
(a) All references to Articles, Sections, subsections and Exhibits are to
Articles, Sections, subsections and Exhibits in or to this Agreement unless
otherwise specified. The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement. The term
"including" is not limiting and means "including without limitation."
(b) In the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including"; the words "to" and
"until" each mean "to but excluding"; and the word "through" means "to and
including."
(c) The Section headings herein are for convenience only and shall not
affect the construction hereof.
(d) This Agreement is the result of negotiations among and has been
reviewed by each Party's counsel. Accordingly, this Agreement shall not be
construed against any Party merely because of such Party's involvement in its
preparation.
(e) Wherever in this Agreement the intent so requires, reference to the
neuter, masculine or feminine shall be deemed to include each of the other, and
reference to either the singular or the plural shall be deemed to include the
other.
SECTION 2. REPRESENTATIONS AND WARRANTIES
2.1 Representations and Warranties of InfiniCom. InfiniCom represents and
warrants to and agrees with Scoop as follows:
(a) Outstanding Shares of 24STORE Stock. The entire authorized capital
stock of 24STORE consists of 20,000,000 ordinary shares, of which 10,000,000
shares are issued and outstanding. All of the shares of 24STORE have been duly
authorized, are validly issued, fully paid and non-assessable. There are no
outstanding or authorized options, warrants, purchase rights, subscription
rights, conversion rights, exchange rights, or other contracts or commitments
that could require 24STORE to issue, sell, or otherwise cause to become
outstanding any of its capital stock. There are no voting trusts, proxies, or
other agreements or understandings to which InfiniCom is a party with respect to
the voting of the capital stock of 24STORE. 24STORE has not issued any other
shares of capital stock, nor repurchased, redeemed or otherwise acquired any
shares of its capital stock from InfiniCom.
(b) Transferability of the 24STORE Stock. InfiniCom holds of record all of
the issued and outstanding shares of 24STORE, and presently has the power to
transfer and deliver to Scoop 95% of the issued and outstanding shares of
24STORE free and clear of any restrictions on transfer (other than any
restrictions under the Securities Act of 1933, as amended, and state securities
laws), taxes, security interests, options, warrants, purchase rights or other
contracts or commitments that could require it to sell, transfer, or otherwise
dispose of any capital stock of 24STORE (other than this Agreement).
(c) Conditions to Closing. Except for its inability to transfer and deliver
to Scoop 100% of the 24STORE Stock free and clear of liens, encumbrances,
restrictions and claims, InfiniCom is ready, willing and able to satisfy all
conditions on its part to the closing of the Stock Purchase Agreement.
SECTION 3. AGREEMENTS
3.1 Partial Closing. On or as soon as possible after the execution of this
Agreement, the parties shall consummate the transactions contemplated by the
Stock Purchase Agreement to occur on the Closing Date, provided that InfiniCom
shall transfer and deliver to Scoop 95% of the 24STORE Stock and Scoop shall
issue to InfiniCom only 95% of the Acquired Shares, and further provided that
InfiniCom shall pay to Scoop an additional $4,450.00 for professional fees and
expenses incurred by Scoop in connection with the closing of the Stock Purchase
Agreement.
3.2 Subsequent Closing. InfiniCom agrees to use commercially reasonable
efforts to transfer and deliver to Scoop the remaining 5% of 24STORE Stock, free
and clear of liens, encumbrances, restrictions and claims, on or before December
31, 1999. Upon InfiniCom's transfer and delivery to Scoop of any additional
shares of 24STORE Stock free and clear of liens, encumbrances, restrictions and
claims, Scoop will issue to InfiniCom the respective pro-rata amount of the 5%
of Acquired Shares reserved from the partial closing pursuant to the foregoing.
On or before December 31, 1999, InfiniCom will pay Scoop an additional $3,050
for professional fees and expenses incurred by Scoop in connection with the
closing of the Stock Purchase Agreement
3.3 Failure of Delivery. If InfiniCom fails to transfer and deliver to
Scoop all the remaining 5% of 24STORE Stock, free and clear of liens,
encumbrances, restrictions and claims, on or before December 31, 1999, Scoop
shall retain its all right and remedies under the Stock Purchase Agreement for
InfiniCom's breach of the Stock Purchase Agreement.
3.4 No Impairment or Modification Without Approval. InfiniCom agrees that
no impairment or modification of any rights of Scoop under the Stock Purchase
Agreement or this Agreement and no settlement or compromise of any claim of
Scoop against InfiniCom for breach of the Stock Purchase Agreement or this
Agreement shall be valid or binding upon Scoop, unless such impairment,
modification, settlement or compromise has been approved in writing by a
majority of Scoop's shareholders (excluding InfiniCom or any affiliate of
InfiniCom) or approved by the Bankruptcy Court as being in the best interests of
Scoop's shareholders (excluding InfiniCom or any affiliate of InfiniCom).
3.5 Governing Law. THE INTERPRETATION AND CONSTRUCTION OF THIS AGREEMENT,
AND ALL MATTERS RELATING HERETO, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
CALIFORNIA APPLICABLE TO AGREEMENTS EXECUTED AND TO BE PERFORMED SOLELY WITHIN
SUCH STATE.
3.6 Parties in Interest. This Agreement may not be transferred, assigned,
pledged or hypothecated by any Party hereto, other than by operation of law.
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective heirs, executors, administrators, successors
and permitted assigns.
3.7 Counterparts. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one instrument.
3.8 Entire Agreement. This Agreement and the other documents referred to
herein contain the entire understanding of the parties hereto with respect to
the subject matter contained herein. Except as provided herein, the Stock
Purchase Agreement shall remain in full force and effect.
3.9 Amendments. This Agreement may not be amended or modified orally, but
only by an agreement in writing signed by Scoop and InfiniCom. No amendment of
this Agreement shall be valid or binding upon Scoop unless such amendment has
been approved in writing by a majority of Scoop's shareholders (excluding
InfiniCom or any affiliate of InfiniCom) or approved by the Bankruptcy Court as
being in the best interests of Scoop's shareholders (excluding InfiniCom or any
affiliate of InfiniCom).
3.10 Third Party Beneficiaries. Each Party hereto intends that this
Agreement shall not benefit or create any right or cause of action in or on
behalf of any Person other than the Parties hereto, provided that nothing in
this Agreement shall impair any rights or remedies of any Scoop shareholder
arising out of any breach of the Stock Purchase Agreement or this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused its corporate
name to be hereunto subscribed by its officer(s) thereunto duly authorized as of
the day and year first above written.
SCOOP, INC.
By: /s/ Rand Bleimeister
-------------------------------
Name: Rand Bleimeister
Title: President and
Chief Executive Officer
INFINICOM AB (publ)
By: /s/ Larsake Sandin
-------------------------------
Name: Larsake Sandin
Title: Chairman of the Board
Business Wire
Copyright (c) 1999, Business Wire
Friday, October 1, 1999
Scoop, Inc. Announces Confirmation Of Plan of Reorganization Under Chapter 11
LOS ANGELES--(BUSINESS WIRE)--Oct. 1, 1999--Scoop, Inc., a Delaware corporation
(OTC:SCPI) ("Scoop"), announced today that, on Sept. 30, 1999, the United States
Bankruptcy Court for the Central District of California confirmed Scoop's
Chapter 11 Plan of Reorganization ("Plan").
The Plan provides for a business combination between Scoop and InfiniCom AB
(publ) ("InfiniCom"), a holding company formed under the laws of Sweden.
InfiniCom will acquire a 91% interest in Scoop in exchange for InfiniCom's
transfer to Scoop of 100% of the stock in 24STORE.com Limited ("24STORE") and a
cash consideration.
Scoop anticipates that, pursuant to the Plan, Scoop's general unsecured
creditors will obtain a recovery of in excess of 90% of their estimated allowed
claims. Scoop's chief executive officer, Rand Bleimeister stated, "I am very
pleased with the outcome of Scoop's reorganization. Scoop's creditors will
obtain a very favorable recovery on their claims, and Scoop's shareholders will
retain a very significant interest in the reorganized company. The
reorganization process certainly worked in this case."
Founded in 1990, Scoop was in the business of offering custom-designed reprints
in hard copy format or HTML format for posting on the World Wide Web. Scoop's
Scoop Information Services Division offered an internet-based information
service, focusing on electronic delivery of information to individuals in
companies.
Scoop is represented in its Chapter 11 case by Robert E. Opera and Hamid R.
Rafatjoo of the Irvine-based law firm of Lobel, Opera & FriedmanLLP
(www.lobelopera.com). Scoop's corporate and securities counsel are William J.
Cernius and Scott Shean of the Costa Mesa office of Latham & Watkins.
CONTACT: Scoop, Inc., Rand Bleimeister, 310/557-1330 or Lobel, Opera & Friedman
LLP, Robert E. Opera, [email protected], Hamid R. Rafatjoo,
[email protected]
<TABLE>
<CAPTION>
DEBTOR IN POSSESSION OPERATING REPORT
SCOOP, INC., a Delaware corporation
Report Number: 14 Page 1 of 3
Debtor. For the period FROM: 9-1-99
TO: 9-30-99
Chapter 11 Case No.: SA 98-20799RA
<S> <C> <C> <C>
1. Profit and Loss Statement (Accrual Basis Only)
A. Related to Business Operations:
Gross Sales 0.00
Less: Sales Returns and Discounts
Net Sales 0.00
Less: Cost of Goods Sold: N/A
Beginning Inventory at Cost NO INVENTORY N/A
Add: Purchases N/A
Less: Ending Inventory at Cost N/A
Cost of Goods Sold
Gross Profit
Other Operating Revenues (Specify)
Less: Operating Expenses:
Officer Compensation 0.00
Salaries and Wages - Other Employees (commissions) 0.00
Total Salaries and Wages
Employee Benefits and Pensions 0.00
Payroll Taxes
Real Estate Taxes
Federal and State Income Taxes
Total Taxes
Rent and Lease Exp. (Real Property and Personal Property)
Interest Expense (Mortgage, Loan, etc.)
Insurance
Automobile Expense
Utilities (Gas, Electricity, Water, Telephone, etc.)
Depreciation and Amortization
Repairs and Maintenance
Advertising
Supplies, Office Expenses, Photocopies, etc. 141.55
Bad Debts
Miscellaneous Operating Expenses (credit card discounts) 5.00
Total Operating Expenses 146.55
Net Gain/Loss from Business Operations (146.55)
B. Not Related to Business Operations:
Income:
Interest Income 3,077.33
Other Non-Operating Revenues (Specify)
Gross Proceeds on Sale of Assets
Less: Original Cost of Assets plus Expenses of Sale
Net Gain/Loss of Sale of Assets
Total Non-Operating Income 3,077.33
Expenses Not Related to Business Operations:
Legal and Professional Fees (Lobel, Opera & Friedman) 19,685.72
Other Non-Operating Expenses (Bleimiester/Allan),
Bankruptcy Admin. Fees 3,873.91
Total Non-Operating Expenses 23,559.63
NET INCOME/LOSS FOR PERIOD (20,628.86)
</TABLE>
<PAGE>
2. Aging of Accounts Payable and Accounts Receivable (exclude pre-petition
accounts payable):
Accounts Payable Accounts Receivable
Current Under 30 Days 22,500.00
Overdue 31 - 60 Days
Overdue 61 - 90 Days 840.00
Overdue 91 - 120 Days 140.00
Overdue Over 121 Days 5,322.00 10,855.00
TOTAL 28,802.00 10,855.00
3. State of Status of Payments to Secured Creditors and Lessors:
<TABLE>
<CAPTION>
Post-Petition
Payments Not Made*
Frequency
of Payments Per Amount Next
Creditor/ Contract/Lease of Each Payment
Lessor (i.e. mo., qtr.) Payment Due Number Amount
<S> <C> <C> <C> <C> <C>
------------------------- ------------------ --------------- ------------- ---------- -----------
------------------------- ------------------ --------------- ------------- ---------- -----------
------------------------- ------------------ --------------- ------------- ---------- -----------
</TABLE>
* Explanation for Non Payment:
------------------------------------------------------------------------
------------------------------------------------------------------------
4. Tax Liability:
Gross Payroll Expense for Period: $0.00
Gross Sales for Period Subject to Sales Tax $0.00
Post-Petition
taxes Still
Date Paid Amount Paid* Owing
Federal Payroll and
Withholding Taxes
State Payroll and Withholding
Taxes
State Sales and Use Taxes 2034.37
Real Property Taxes
* Attach photocopies of depository receipts from taxing authorities
or financial institutions to verify that such deposits or
payments have been made.
<TABLE>
<CAPTION>
5. Insurance Coverage Carrier/ Amount Policy Premium
Agent of Expiration Paid Through
Name Coverage Date Date
<S> <C> <C> <C> <C>
Worker's Compensation
Liability
Fire and Extended Coverage
Property
Theft
Life (Beneficiary:
__________________)
Vehicle
Other (Specify):
___________________
Director and Officer Insurance
</TABLE>
6. Questions:
A. Has the Debtor in Possession provided compensation to any
officers, directors, shareholders, or other principals without
the approval of the Office of the United States Trustee?
[_] Yes Explain: -----------------------------------
[X] No
B. Has the Debtor in Possession, subsequent to the filing of the
petition, made any payments on its pre-petition unsecured debt, except
as have been authorized by the Court:
[_] Yes Explain: -----------------------------------
[X] No
7. Statement of Unpaid Professional Fees (Post-Petition Amounts Only)
State Type of Total Post-
Professional Petition Amount
Name of Professional (Attorney/Accountant/etc.) Unpaid
Lobel, Opera & Friedman Attorney 276,472.16
8. Narrative Report of Significant Events and Events out of the Ordinary
Course of Business: (Attach separate sheet if necessary)
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
9. Quarterly Fees: (This Fee must be paid to the United States Trustee
every calendar quarter)
<TABLE>
<CAPTION>
Quarterly Total Quarterly
Period Disbursements Quarterly Date Amount Check Fee Still
Ending For Quarter Fee Paid Paid No. Owing
<S> <C> <C> <C> <C> <C> <C>
9/30/98 321,808 3,750.00 11/4/98 3,750.00 1144 0
12/31/98 417,763 3,750.00 1/22/99 3,750.00 1178 0
3/31/99 20,222 500.00 5/4/99 500.00 1201 0
6/30/99 81,364 750.00 7/30/99 750.00 1222 0
9/30/99
</TABLE>
I, (Name/Title: Kristy Allan, Chief Accounting Officer), declare under penalty
of perjury that the information contained in the above Debtor in Possession
Operating Report is true and complete to the best of my knowledge.
Dated: Nov. 1, 1999 /s/ Kristy Allan
-------------------------------
Debtor in Possession or Trustee
